US Senator Elizabeth Warren has asked the Federal Trade Commission (FTC) to take a tougher look at defense industry mergers, questioning a proposal from Lockheed Martin that would allow it to buy the biggest independent maker of rocket motors, Aerojet Rocketdyne Holdings.
The Democratic senator, who has a keen interest in corporate behavior, asked the FTC to examine the premise and efficacy of internal firewalls like those Lockheed proposes to prevent it from gaining a competitive advantage over peers once the deal closes, according to a July 16 letter seen by Reuters.
Lockheed Martin announced a US$4.4 billion agreement to buy Aerojet late last year, a deal that has raised eyebrows because it would give Lockheed – the No. 1 defense contractor – ownership of a vital piece of the US missile industry whose motors are used in everything from the homeland missile shield to Stinger missiles.
Lockheed has stated after the deal closes “the Aerojet Rocketdyne business will continue to serve as a merchant supplier” to the entire defense industry, a premise that was met with skepticism by Raytheon, a major customer for rocket motors.
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