FTC Approves Aerojet-Pratt & Whitney Rocketdyne Merger
WASHINGTON — GenCorp Inc. is free to proceed with its $550 million acquisition of rocket engine manufacturer Pratt & Whitney Rocketdyne from United Technologies Corp. after the U.S. Federal Trade Commission (FTC) closed an investigation into whether the transaction would lead to an anti-competitive marketplace.
An FTC investigation had found the merger would give Sacramento, Calif.-based Aerojet, and its parent company GenCorp., a monopoly in liquid divert and attitude control systems, or LDACS, which are used for missile defense interceptors. Such an arrangement could lead to higher prices for the U.S. Defense Department, the FTC said.
In January, GenCorp said Aerojet planned to divest its LDACS business.
But in a June 6 letter, the Defense Department asked the FTC to allow the merger, claiming it could help space launch requirements and that the divestiture of the LDACS business would be “impossible due to highly unusual national security circumstances.”
Citing the Defense Department’s position, the FTC announced June 10 it had closed its investigation and would allow the merger to proceed unchallenged.
East Hartford, Conn.-based United Technologies Corp. and Aerojet announced the deal for Pratt & Whitney Rocketdyne of Canoga Park, Calif., in July 2012. The merger will create a dominant U.S. supplier of liquid-fueled rocket engines in addition to in-space and missile propulsion systems.
Aerojet also is one of two U.S. suppliers of solid-rocket motors, the other being ATK Aerospace of Magna, Utah.