EL SEGUNDO, Calif. – The aerospace and defense firm Aerojet Rocketdyne Holdings Inc. has entered into a definitive agreement to be acquired by Lockheed Martin Corporation in an all-cash transaction with a total equity value of $5 billion, Aerojet announced recently.
Under the terms of the agreement, which has been unanimously approved by each company’s board of directors, Lockheed Martin will acquire Aerojet Rocketdyne for $56 per share in cash, representing a premium of approximately 33% to Aerojet Rocketdyne’s closing stock price on Dec. 18 and a premium of approximately 42% to the company’s volume weighted average stock price for the last 90 trading days.
As part of the transaction, Aerojet Rocketdyne declared a $5 per-share pre-closing special dividend to holders of its common shares and convertible senior notes, on an as-converted basis. The special dividend will be paid March 24, 2021, to holders of record as of March 10. The payment of this special dividend, unless revoked, will adjust Lockheed Martin’s consideration to $51 per share at closing.
“We are pleased to bring together our complementary companies in a transformative transaction that will provide premium cash value for our stockholders and tremendous benefits for our employees, customers and partners,” said Eileen P. Drake, CEO and president of Aerojet Rocketdyne. “Joining Lockheed Martin is a testament to the world-class organization and team we’ve built and represents a natural next phase of our evolution.”
The transaction is expected to close in the second half of 2021 and is subject to the satisfaction of customary closing conditions, including regulatory approvals and approval by Aerojet Rocketdyne’s stockholders. A transition team will be formed to promote a seamless integration and ensure continuity for customers, employees and other stakeholders.