Defense Business Brief: What’s next for Aerojet; NATO summit arms deals; Raytheon’s $50K hiring bonus; and more.
Aerojet Rocketdyne CEO Eileen Drake appears to have won a proxy fight with Chairman Warren Lichtenstein, settling a boardroom drama intensely watched from the sidelines by Pentagon officials concerned about the leadership of one of its most critical suppliers. Now officials want to see the company’s plans for the future.
“The question is, what do they do now…What is the path ahead?” Andrew Hunter, the Air Force’s top acquisition official told reporters June 24. “We do need that path to become clearer and them to figure it out.”
Aerojet Rocketdyne makes important parts of some of the Pentagon’s most high-profile weapons, including rocket motors for Javelin anti-tank weapons being used in Ukraine and key engines on the Atlas and Delta rockets. Lockheed Martin had planned to buy the company, but abandoned the acquisition earlier this year after government antitrust regulators sued to block the deal over competition concerns.
The boardroom fight between Lichtenstein and Drake became public soon after. With shareholders appearing to back Drake and a board of her choosing, the question is: What now?
“I think the government is still kind of waiting to see what is their plan, corporately, and then we'll have an opportunity to assess and say: ‘[Is] that really gonna meet our needs?’” Hunter said.
Elsewhere on the M&A front: The Justice Department has sued to block Booz Allen Hamilton’s acquisition of EverWatch, an intelligence community contractor that specializes in data science, intelligence, and cybersecurity. “The complaint…alleges that the merger agreement threatens imminent competition for a government contract to provide operational modeling and simulation services to the National Security Agency,” Justice officials said in a statement. “Unless enjoined, the transaction would eliminate competition for this defense contract, leaving NSA to face a monopoly bidder.”
That’s not the case, Booz Allen responded. “We strongly disagree with the Department of Justice’s characterization of the proposed $440 million, approximately 500-person EverWatch transaction. We believe the acquisition would bring together two companies with complementary capabilities to support our collective national security interests and would enhance competition overall in an industry that is highly competitive.”
Three big contracts: First, the Army chose General Dynamics Land Systems over BAE Systems to build a new light tank, called Mobile Protected Firepower. The $1.1 million deal is for 96 of the small tanks. Second, the Coast Guard awarded Austal a $3.3 billion deal for up to 11 Offshore Patrol Cutters. “The…program is the Coast Guard’s highest investment priority as it will recapitalize the aging endurance cutters and provide a capability bridge between the service’s national security cutters which operate in the open ocean and the fast response cutters which operate closer to shore,” the company said. Lastly, the Army placed a $216 million order for 513 Joint Light Tactical Vehicles and 1,152 trailers. The vehicles and trailers are for the U.S. military and Montenegro, Brazil, and Lithuania.
The NATO summit in Madrid brought lots of weapon-sales announcements from allies looking to build up militaries in the wake of Russia’s invasion of Ukraine. Among the deals: Greece said it wants to buy 20 F-35 stealth fighters; Sweden placed an order with Saab for two GlobalEye airborne early warning and control planes; the U.S. said it would support Turkey buying up to 40 new F-16s and modernizing another 80 jets already in its fleet. Also, Spain said it would boost defense spending to the NATO guideline of 2 percent of GDP by 2029. Madrid currently spends about 1 percent of GDP on defense.
And finally, Raytheon Technologies’ Missiles & Defense business is offering $50,000 sign-on bonuses for engineering and finance positions in Tucson, Arizona. “For eligible finance positions, sign-on bonuses are available for those who have an active security clearance. For engineers, sign-on bonuses are available to those hired into qualified roles, regardless of current clearance status. However, bonus amounts are higher for individuals with active security clearances.”
From Defense One
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Pentagon Agency Wants to Send Arms Monitors to Ukraine // Marcus Weisgerber
The defense officials would make sure U.S. weapons are being used and stored properly.
What Turkey Got for Letting Sweden, Finland Join NATO // Elisabeth Braw
And the prospective alliance members got a lesson in the politics of collective defense.
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