The FTC challenged Lockheed Martin’s proposed $4.4 billion acquisition of Aerojet Rocketdyne in January 2022, but it did not win a final ruling that the merger was illegal. Lockheed terminated the deal after the challenge, and the FTC dismissed its proceeding. The case matters because the agency argued that combining a major missile maker with a key propulsion supplier could disadvantage rival defense contractors.
What happened in the Lockheed–Aerojet case?
Lockheed Martin proposed to acquire Aerojet Rocketdyne Holdings for $4.4 billion. On January 25, 2022, the Federal Trade Commission voted 4-0 to issue an administrative complaint and authorized staff to seek a preliminary injunction to stop the acquisition while the case proceeded. The FTC described the transaction as a vertical merger: Aerojet supplied propulsion and related inputs used in missile systems made by Lockheed and other defense contractors. FTC announcement
After the FTC challenged the deal, Lockheed terminated the proposed transaction in February 2022. The parties sought dismissal, and the FTC dismissed its complaint after the merger agreement was terminated and the parties withdrew their Hart-Scott-Rodino notification. The FTC case record lists the matter as closed. FTC case record
Why did the FTC oppose the acquisition?
The FTC’s complaint alleged that ownership of Aerojet could give Lockheed both the ability and the incentive to disadvantage competing contractors that depended on Aerojet’s missile propulsion products. The agency described Aerojet as a significant independent U.S. supplier—and, for certain products, the sole supplier. These were allegations in the complaint, not findings reached after a trial. FTC administrative complaint
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Potential disadvantages for rival contractors
According to the FTC, a combined company might restrict or degrade rivals’ access to key inputs, or disadvantage them through pricing, product quality, engineering support, delivery schedules, or contract terms. The complaint alleged possible competitive harm in markets involving missile rounds or systems, missile-defense kill vehicles, and hypersonic cruise missiles. The agency argued that such conduct could weaken rivals’ ability to compete for defense programs.
Competitively sensitive information
The complaint also raised a separate concern: Aerojet worked as a subcontractor and could receive competitors’ sensitive technical and business information. The FTC alleged that, under common ownership, Lockheed could have access to or use information supplied by rival contractors. That was a claimed risk, not a public finding that Lockheed had misused such information.
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Possible effects on government customers
The FTC said reduced competition could affect costs to the government, product quality, and innovation. Its announcement also said the Department of Defense reviewed the acquisition and provided its assessment to the FTC. These points describe the agency’s account of its concerns; the case ended without a merits decision establishing that the predicted effects would occur. FTC announcement
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Did the FTC or a court rule that the merger was illegal?
No final merits ruling is reflected in the case record. The FTC filed an administrative complaint alleging that consummating the acquisition would violate Section 7 of the Clayton Act and Section 5 of the FTC Act, and it authorized a request for a preliminary injunction. Lockheed ended the transaction before the allegations were adjudicated. The FTC then dismissed the proceeding. FTC case record FTC Decisions, Volume 173
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That distinction is important: saying the FTC “blocked” the acquisition is shorthand for the agency’s challenge followed by Lockheed’s termination of the deal. It does not mean a judge blocked it after trial, or that the FTC obtained a final decision finding the merger unlawful.
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Timeline and outcome
| Date | Event |
|---|---|
| January 25, 2022 | The FTC announced a 4-0 vote to issue an administrative complaint and authorized staff to seek a preliminary injunction. FTC announcement |
| January 2022 | The FTC filed its complaint, alleging that the acquisition, if completed, would violate federal antitrust laws. FTC administrative complaint |
| February 2022 | Lockheed terminated the proposed transaction, and the parties sought dismissal. FTC case record |
| February 15, 2022 | The FTC issued a statement after the termination; its case materials record dismissal and closure. FTC statement FTC Decisions, Volume 173 |
What the case does—and does not—establish
- Established by the public record: Lockheed proposed a $4.4 billion acquisition; the FTC challenged it; Lockheed terminated the deal; and the FTC proceeding was dismissed and marked closed.
- Alleged, not proven in a merits ruling: that common ownership could let Lockheed disadvantage rival contractors, exploit sensitive information, or reduce competition in ways affecting price, quality, support, delivery, or innovation.
- Not established by the case outcome: that Lockheed actually used Aerojet information improperly, that the forecast harms occurred, or that a court found the proposed merger unlawful.
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