A team from Lockheed Martin is working to come up with a new proposal to put to the US competition watchdog, the Department of Justice (DoJ), to salvage its proposed merger with Northrop Grumman.
The eleventh hour effort began at the start of March after the DoJ had informed Lockheed Martin that it was "fundamentally opposed" to elements of the merger. The US Department of Defense has also raised "serious concerns about the competitive effects of the transaction".
The group has now agreed that it will not go ahead with the $9.1 billion deal until 24 April as it works to come up with a package of post-merger disposals to satisfy the DoJ. No details have been given about the grounds of the governmental opposition, but informed sources suggest that these centre on the extent of the additional electronic warfare capability that Northrop Grumman would bring to Lockheed Martin.
It is also understood that the DoJ wants disposals worth around $1 billion, more than twice the size of the divestures initially proposed by Lockheed Martin.
Source: Flight International