Lockheed Martin to Acquire Aerojet Rocketdyne
(Source: Lockheed Martin; issued Dec. 20, 2020)
BETHESDA, Md. --- Lockheed Martin Corporation today announced it 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.
Headquartered in Bethesda, Maryland, Lockheed Martin Corporation is a global security and aerospace company that employs approximately 110,000 people worldwide and is principally engaged in the research, design, development, manufacture, integration and sustainment of advanced technology systems, products and services.
Aerojet Rocketdyne to be Acquired by Lockheed Martin in $5.0 Billion All-Cash Transaction
(Source: Aerojet Rocketdyne; issued Dec. 20, 2020)
EL SEGUNDO, Calif. --- Aerojet Rocketdyne Holdings, Inc. today announced that it has entered into a definitive agreement to be acquired by Lockheed Martin Corporation in an all-cash transaction with a total equity value of $5.0 billion.
Under the terms of the agreement, which has been unanimously approved by each company’s Board of Directors, Lockheed Martin will acquire Aerojet Rocketdyne for $56.00 per share in cash, representing a premium of approximately 33% to Aerojet Rocketdyne’s closing stock price on December 18, 2020 and a premium of approximately 42% to the Company’s volume weighted average stock price (“VWAP”) for the last 90 trading days.
As part of the transaction, Aerojet Rocketdyne declared a $5 per share pre-closing special dividend to holders of its common shares and convertible senior notes, on an as-converted basis. The special dividend will be paid on March 24, 2021, to holders of record as of March 10, 2021. The payment of this special dividend, unless revoked, will adjust the consideration to be paid by Lockheed Martin to $51 per share at closing.
“We are pleased to bring together our complementary companies in a transformative transaction that will provide premium cash value for our shareholders and tremendous benefits for our employees, customers and partners,” said Eileen P. Drake, CEO and President of Aerojet Rocketdyne. “Joining Lockheed Martin is a testament to the world-class organization and team we’ve built and represents a natural next phase of our evolution.
“As part of Lockheed Martin, we will bring our advanced technologies together with their substantial expertise and resources to accelerate our shared purpose: enabling the defense of our nation and space exploration. On behalf of the Aerojet Rocketdyne Board and management team, I’d like to thank all of our employees for their unwavering dedication and focus in helping us achieve this great milestone.”
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. A transition team will be formed to allow for a seamless integration and ensure continuity for customers, employees and other stakeholders.
Citigroup Global Markets Inc. and Evercore were co-lead financial advisors to Aerojet Rocketdyne. Jenner & Block LLP acted as M&A counsel and Gibson, Dunn & Crutcher LLP acted as Securities counsel.
Aerojet Rocketdyne, a subsidiary of Aerojet Rocketdyne Holdings, Inc., is a world-recognized aerospace and defense leader that provides propulsion systems and energetics to the space, missile defense and strategic systems, and tactical systems areas, in support of domestic and international customers.