US military-industrial concern Lockheed Martin Corp has signed an agreement to buy rocket engine manufacturer Aerojet Rocketdyne Holdings for $4.4 billion, Lockheed Martin said in a statement.
The deal will merge the companies, which already collaborate in the aviation industry.
Lockheed will pay $56 per Aerojet Rocketdyne share, a 33% increase in the value of the company’s securities at the close of trading Friday. The final price will be reduced to $51 per share, taking into account the $5 per share special dividend payment that will precede the closing of the deal.
“The acquisition of Aerojet Rocketdyne will preserve and strengthen an important component of our defense industrial base and reduce costs for our customers and American taxpayers,” said Lockheed President and CEO James Teiclet, who was quoted in a company statement.
Lockheed and Aerojet Rocketdyne expect to complete the deals in the second half of 2021.