Lockheed Martin's bid to buy Aerojet Rocketdyne for $4.4 billion is dead.
On Sunday, Lockheed officially announced the termination of the agreement to acquire Aerojet, citing the Federal Trade Commission's lawsuit to block the deal.
Lockheed announced plans to acquire the rocket engine manufacturer in late December, but federal regulators sued seeking a preliminary injunction about a month later.
The FTC said the deal would limit competition and drive up the prices for missile components.
According to the FTC, Aerojet is the last independent U.S. supplier of essential missile parts. The deal would allegedly allow Lockheed to cut off the supply of those components to rivals Raytheon, Northrop Grumman and Boeing.
In a statement, Lockheed Martin Chairman, President and CEO James Taiclet said, "Our planned acquisition of Aerojet Rocketdyne would have benefitted the entire industry through greater efficiency, speed, and significant cost reductions for the U.S. government. ... However, we determined that in light of the FTC's actions, terminating the transaction is in the best interest of our stakeholders."
According to Taiclet, Lockheed will still support Aerojet Rocketdyne as a partner.
After the deal fell through, Aerojet Rocketdyne released a statement saying the company is "poised to deliver substantial value to our shareholders driven by our continued leadership in key space exploration and defense growth markets, including by advancing hypersonics and strategic, tactical and missile defense systems."
The company sought to reassure shareholders by boasting that its backlog is more than three times the company's annual sales.