Lockheed Martin To Acquire Aerojet Rocketdyne
Dec. 20, 2020
Lockheed Martin Corporation
has entered into a definitive agreement to
acquire Aerojet Rocketdyne Holdings, Inc.
for $56 per share in cash, which is expected to
be reduced to $51 per share after the payment of
a pre-closing special dividend. This represents
a post-dividend equity value of $4.6 billion and
a total transaction value of $4.4 billion
including the assumption of net cash.
As part of approving the
transaction, Aerojet Rocketdyne announced a
special cash dividend, revocable at its option
through the payment date, of $5 per share to its
holders of record of common stock and
convertible senior notes (on an as-converted
basis) as of the close of business on March 10,
2021, and payable on March 24, 2021.
"Acquiring Aerojet
Rocketdyne will preserve and strengthen an
essential component of the domestic defense
industrial base and reduce costs for our
customers and the American taxpayer," said James
Taiclet, Lockheed Martin president and CEO.
"This transaction enhances Lockheed Martin's
support of critical U.S. and allied security
missions and retains national leadership in
space and hypersonic technology. We look forward
to welcoming their talented team and expanding
Lockheed Martin's position as the leading
provider of 21st century warfare solutions."
With 2019 revenue of
approximately $2 billion, nearly 5,000
employees, and 15 primary operations sites
across the United States, Aerojet Rocketdyne is
a world-recognized aerospace and defense rocket
engine manufacturer. Aerojet Rocketdyne has deep
customer relationships and significant demand
for its innovative technologies. The proposed
acquisition adds substantial expertise in
propulsion to Lockheed Martin's portfolio, and
expands on the solid foundation built by
Lockheed Martin and Aerojet Rocketdyne over many
years. Aerojet Rocketdyne's propulsion systems
are already a key component of Lockheed Martin's
supply chain and several advanced systems across
its Aeronautics, Missiles and Fire Control and
Space business areas.
The transaction is expected
to close in the second half of 2021 and is
subject to the satisfaction of customary closing
conditions, including regulatory approvals and
approval by Aerojet Rocketdyne's stockholders.
Lockheed Martin has a history of successful
integrations and will work to efficiently
deliver the many strategic and financial
benefits of this transaction. A transition team
will be formed to allow for a seamless
integration and ensure continuity for customers,
employees and other stakeholders.