Rocket maker Aerojet solicits acquisition offers -sources

Aerojet Rocketdyne Holdings

25/10/2022 16:14

(Adds share reaction, background)
    By David  Carnevali
       NEW YORK, Oct 25 (Reuters) - Aerojet Rocketdyne Holdings
Inc  AJRD.N , the U.S. rocket maker whose $4.4 billion sale to
Lockheed Martin Corp  LMT.N  was blocked by antitrust regulators
in February, is soliciting offers from potential suitors,
including private equity firms, according to people familiar
with the matter.
    Aerojet, which is providing propulsion engines for NASA's
Artemis 1 moon rocket, is working with advisers on an auction
process and asked for indications of acquisition interest
earlier this month, the sources said. 
    The company, which has a market value of $3.6 billion, may
decide not to sell itself if it fails to attract an offer it
deems attractive, the sources added.
    They requested not to be identified because the matter is
confidential. An Aerojet spokesperson declined to comment.
    Aerojet shares jumped 7% to $48.46 in morning trading in New
York on Tuesday. 
    Aerojet develops and manufactures liquid and solid rocket
propulsion and hypersonic engines for space, defense, civil and
commercial applications. Its customers include the Pentagon,
Boeing  BA.N , Lockheed Martin and Raytheon Technologies Corp
 RTX.N .
    The El Segundo, California-based company prevailed in a
battle for control of its board against former executive
chairman Warren Lichtenstein last summer but remains under
pressure to boost its performance. Activist hedge fund Elliott
Investment Management disclosed it had accumulated a 3.7% stake
in Aerojet in August.
    Aerojet Chief Executive Eileen Drake said in September that
"low to mid-single-digit" sales growth was most probable for the
company this year.
    Drake added that she expects more orders for Aerojet's
defense equipment as the U.S. military replenishes its inventory
after supplying Ukraine weapons for its war with Russia. 
 (Reporting by David Carnevali in New York; Addditional
reporting by Svea-Herbst Bayliss in Rhode Island
Editing by Tomasz Janowski and Bill Berkrot)
 ((David.Carnevali@thomsonreuters.com;))