In a transaction announced Sunday, L3Harris Technologies Inc. (NYSE: LHX) has reached a definitive agreement to acquire Aerojet Rocketdyne Holdings Inc. (NYSE: AJRD) in a deal valued at $4.7 billion, including Aerojet’s net debt. L3Harris will pay $58 a share in cash, a premium of 37% to Aerojet’s “unaffected” closing price as of August 15, 2022 ($42.49). On that date, activist investment firm Elliott Management revealed that it had taken a position in Aerojet.
[in-text-ad]
Two years ago, Lockheed Martin Corp. (NYSE: LMT) announced a definitive merger agreement with Aerojet Rocketdyne valued a $4.4 billion, or $56 per share. At the time, the premium was 33%. How times change.
If Aerojet’s board changes its mind, it will cost the company $95.6 million in a termination fee. If L3Harris backs out, its termination payment to Aerojet is set at $406.3 million.
Lockheed Martin ended its December 2020 bid for Aerojet in February after the Federal Trade Commission sued to block the deal for anti-competitive reasons. Lockheed wanted to acquire the missile propulsion systems the country’s largest defense contractor was using in its hypersonic missile project.
24/7 Wall St.A combined Aerojet-L3Harris would have a market cap of around $45 billion. That would not alter L3Harris’s ranking, however, leaving it in sixth place behind McKesson.
Aerojet’s stock traded up about 1% in Monday’s premarket at $55.41. L3Harris shares traded down about 1.7% at $209.57.
Take This Retirement Quiz To Get Matched With A Financial Advisor (Sponsored)
Take the quiz below to get matched with a financial advisor today.
Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests.
Here’s how it works:
1. Answer SmartAsset advisor match quiz
2. Review your pre-screened matches at your leisure. Check out the advisors’ profiles.
3. Speak with advisors at no cost to you. Have an introductory call on the phone or introduction in person and choose whom to work with in the future
Take the retirement quiz right here.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Editors' Picks
