Lockheed Martin Corp. has terminated its agreement to acquire Aerojet Rocketdyne Holdings Inc. in a deal valued at $4.4 billion.
The decision came because the Federal Trade Commission filed a lawsuit seeking a preliminary injunction to block the deal between Aerojet Rocketdyne in El Segundo and Bethesda, Md.-based Lockheed, the company said in a release.
Aerojet has a rocket engine manufacturing site in Chatsworth where it builds the RS-25 engine for NASA’s Space Launch System rocket to take humans back to the Moon and on deep space missions. Lockheed owns the Skunk Works facility in Palmdale, where it handles classified contracts with the U.S. military.
“We determined that in light of the FTC’s actions, terminating the transaction is in the best interest of our stakeholders,” Lockheed Chief Executive James Taiclet said in a statement.Â
For its part, Aerojet said that it was confident in the company’s future as it has amassed a backlog of contracts more than three times the size of its annual sales.
The transaction was expected to close in the second half of last year until the FTC lawsuit.
“If permitted, the proposed acquisition would allow the combined firm to use its control of Aerojet to harm Lockheed’s rivals in ways that would substantially lessen competition in multiple markets for products critical to the national defense,” according to the FTC complaint filed Jan. 25.