FTC Gives OK To Boeing, Lockheed JV

Lockheed Martin confirmed to Aero-News Tuesday that United Launch Alliance, L.L.C. (ULA), its joint venture with the Boeing, had received anti-trust clearance from the Federal Trade Commission (FTC). The clearance is subject to compliance with a consent order that both parties have approved, and which upon closing of the transaction will govern certain activities of ULA, Lockheed Martin and Boeing.

The ULA partnership combines the production, engineering, test and launch operations associated with US government launches of Boeing Delta and Lockheed Martin Atlas rockets. The purpose for combining the Atlas and Delta operations is to reduce the cost of meeting the national security and civil expendable launch vehicle needs of the United States. ULA is to be structured as a 50-50 joint venture between Boeing and Lockheed Martin.

The action by the FTC will allow Boeing and Lockheed Martin to finalize closing documents and work toward setting a closing date.

The ULA venture was first announced on May 2, 2005. As Aero-News reported earlier this year, Lockheed Martin CFO Chris Kubasik dropped a bombshell in April when he revealed that the company's board would review the business case for the proposed partnership. There was also speculation the board would decide to spike the entire deal.

Kubasik's announcement came as Lockheed became increasingly frustrated with the antitrust review -- as well as concessions required for the deal to move forward, such as limits on profit margins and investment levels. Those concerns have been addressed in the agreement.

Upon closing, Michael Gass, vice president and general manager of Lockheed Martin Space Transportation, will become ULA president and CEO. Dan Collins, vice president of Boeing Expendable Launch Systems, will serve as chief operating officer. These leaders will report to a six-member board of directors, each company appointing three directors.

ULA headquarters will be in Denver, CO with most engineering and administrative activities consolidated at Lockheed Martin's Space Systems Company facilities. Major assembly and integration operations will be located primarily at Boeing's manufacturing and assembly facility in Decatur, AL.

As part of the joint venture, the companies' launch facilities at Cape Canaveral Air Force Station in Florida and Vandenberg Air Force Base in California will provide flexibility for meeting launch requirements on East and West coasts. ULA is expected to have about 3800 employees at sites in Colorado, Alabama, Florida, California and Texas.

Following the closing of ULA, Boeing and Lockheed Martin have agreed to dismiss all civil litigation against each other related to a previous competition for launches under the Air Force EELV program.

FMI: www.boeing.com, www.lockheedmartin.com