Aerojet Bids About $2 Billion for [ULA] Boeing-Lockheed Rocket Venture

[Unobscured Vision]

Yeah, this was a big mess that turned into a "charlie foxtrot". Just ... argh. What a mindjob.

In this business, OldSpace will knife OldSpace in the back, and then the one getting knifed will simply turn around and obliviously ask "huh?".

The offer will likely be retracted.

[Draggendrop Veteran]

Yeah, this was a big mess that turned into a "charlie foxtrot". Just ... argh. What a mindjob.

In this business, OldSpace will knife OldSpace in the back, and then the one getting knifed will simply turn around and obliviously ask "huh?".

The offer will likely be retracted.

And while they are fighting....(background noise of airtools, welders, cranes, sqeeky wheels.....thump, thump, thump...(monty python)....queak, queek..)   ...out rolls newspace "taking care of business" toys, for all......

[Unobscured Vision]

 

And while they are fighting....(background noise of airtools, welders, cranes, sqeeky wheels.....thump, thump, thump...(monty python)....queak, queek..)   ...out rolls newspace "taking care of business" toys, for all......

"Bring out yer dead!" *clang*

"I'm not dead!"

"You're not fooling anyone, you know.". 

[Draggendrop Veteran]

"Bring out yer dead!" *clang*

"I'm not dead!"

"You're not fooling anyone, you know.". 

Kind of like this.......(2:45 min).......

Later.......

[Draggendrop Veteran]

This Aerojet/ULA/Orbital/Boeing/Lockhead Martin "B" movie plot, just gets worse with time..... 

Buying/Selling ULA: The Four Amigos Continue To Squabble

By Keith Cowing
 

Aerojet weighs higher offer for Lockheed-Boeing venture - sources, Reuters

"Aerojet Rocketdyne Holdings Inc is considering raising its $2 billion offer for United Launch Alliance, a rocket launch venture of Boeing Co and Lockheed Martin Corp, but faces big hurdles after a public rejection of the bid last week, according to multiple sources familiar with the matter. ... The sources said Aerojet faces an uphill climb given growing tensions between the two companies over the past few years. This week ULA dumped Aerojet as its solid rocket motor supplier and signed a long-term deal with its rival Orbital, which is not currently in that business."

Aerojet to pay Orbital $50 million over Antares rocket accident, Reuters

"Aerojet Rocketdyne Holdings Inc will pay Orbital $50 million to settle a dispute stemming from an Antares rocket launch accident last year that destroyed a load of cargo bound for the International Space Station, Aerojet said on Thursday."

United Launch Alliance Selects Orbital ATK to Provide Solid Boosters for Atlas V and Vulcan

"Today United Launch Alliance and Orbital ATK, Inc. announced a long-term strategic partnership in which Orbital ATK will become the sole provider of solid rocket boosters for ULA's Atlas V and Vulcan launch vehicles, effective in 2019 when the new motors are ready for launch."

ULA, The Four Amigos, and The Future of Competition in Space Commerce, earlier post

"But wait: the same Aerojet Rocketdyne/Boeing/Lockheed Martin/Orbital ATK crowd (aka "The Four Amigos" in industry circles) is also building SLS - and ULA was always a sanctioned monopoly (until SpaceX showed up and spoiled that party). Everyone seems to be hedging their bets these days via acquisitions and consolidations - instead of trying to build newer and better rockets that actually do things more cheaply/efficiently - except SpaceX, I guess."

http://nasawatch.com/archives/2015/09/buyingselling-u.html

Which is....
Exclusive: Aerojet weighs higher offer for Lockheed-Boeing venture - sources 

Aerojet Rocketdyne Holdings Inc (AJRD.N) is considering raising its $2 billion offer for United Launch Alliance, a rocket launch venture of Boeing Co (BA.N) and Lockheed Martin Corp (LMT.N), but faces big hurdles after a public rejection of the bid last week, according to multiple sources familiar with the matter.

Aerojet is meeting with outside advisers this week to explore its options, said the sources, who were not authorized to speak publicly about the discussions. One of the sources said the company could announce its next moves in coming weeks.

The company's spokesman, Glenn Mahone, said the two companies remained in discussions about "a number of business arrangements," but gave no details.

The sources said Aerojet faces an uphill climb given growing tensions between the two companies over the past few years. This week ULA dumped Aerojet as its solid rocket motor supplier and signed a long-term deal with its rival Orbital ATK (OA.N), which is not currently in that business.

Aerojet and ULA have discussed a merger in the past, but were unable to reach agreement, the sources said.

Last summer, Aerojet's board also rejected ULA's request that Aerojet invest $300 million to accelerate work on the AR-1 engine it is developing as an alternative to the Russian RD-180 engine that powers ULA's Atlas V rocket, the sources said.

U.S. lawmakers last year banned use of the Russian engines for U.S. military and spy satellite launches after 2019, to protest Russia's annexation of the Crimea region of Ukraine.

Aerojet's refusal to invest more in the AR-1 engine ultimately drove ULA to opt for the BE-4 engine being developed by privately held Blue Origin, which is owned by Amazon.com founder and billionaire Jeff Bezos, the sources said.

An Aerojet takeover of ULA would also require Russia to give its regulatory approval and transfer a technology license for use of the RD-180 engines, according to two of the sources.

Russia refused to transfer the license to Aerojet when it bought Rocketdyne from Pratt & Whitney, a United Technologies Corp (UTX.N) unit in 2013, forcing Pratt to retain control of a small company that brokers RD-180 sales, and could be more reluctant to do so now, the sources said.

 

 

Analysts say a tie-up between ULA and Aerojet would make sense since both companies's revenues are threatened by a drop in U.S. military satellite launches, and the rise of privately held Space Exploration Technologies, or SpaceX, which builds its own rockets and motors to keep costs down. The Air Force earlier this year certified SpaceX to bid for some military and spy satellite launches and break ULA's nine-year monopoly.

"In the mid-term, the only way you can have a viable company that can compete better on price is to integrate the two businesses, the way SpaceX operates," said Marco Caceres, space analyst with the Virginia-based Teal Group.

Boeing last week rejected as unserious Aerojet's initial bid, which came in a two-sentence email from Warren Lichtenstein, who heads Aerojet's board and serves as executive chairman of Steel Partners Holdings (SPLP.N).

Officials at ULA and Lockheed have declined comment.

Wall Street analysts have questioned how Aerojet could raise the money for the deal, and why the bid lacked the necessary supporting materials. Some also questioned whether ULA was even worth $2 billion given the changing space market.

If Aerojet fails to reach a deal with ULA, industry executives said the company's board could still try to break the company up and sell its parts.

Lichtenstein, the board chairman, engineered a similar break up of AAI that began in 2002 and eventually saw its key drone business sold to Textron Inc (TXT.N) for over $1 billion.

 http://www.reuters.com/article/2015/09/24/us-lockheedmartin-boeing-aerojet-idUSKCN0RO2OG20150924

And this.......

Boeing last week rejected as unserious Aerojet's initial bid, which came in a two-sentence email from Warren Lichtenstein, who heads Aerojet's board and serves as executive chairman of Steel Partners Holdings (SPLP.N).

Two sentence email bid....what kind os BS is this, and the media was all over it...meaning intentional set-up...to sell?

Then......

Aerojet to pay Orbital $50 million over Antares rocket accident

Aerojet to pay Orbital $50 million over Antares rocket accident

Aerojet Rocketdyne Holdings Inc (AJRD.N) will pay Orbital ATK (OA.N) $50 million to settle a dispute stemming from an Antares rocket launch accident last year that destroyed a load of cargo bound for the International Space Station, Aerojet said on Thursday.

The company also said it would take title to 10 AJ-26 rocket engines previously earmarked for Orbital, one of two companies hired by NASA to fly cargo to the station after the agency retired its space shuttles.

Orbital successfully flew two of eight planned missions under its original $1.9 billion contract with NASA before the Oct. 28, 2014, accident from Wallops Island, Virginia.

A final report on the botched mission is pending, though the companies have publicly disagreed about whether an engine manufacturing problem by Aerojet and/or mishandling of the engine during processing by Orbital triggered the explosion.

Aerojet declined to release any details about the settlement.

“All the data related to the analysis is proprietary,” Aerojet spokesman Glenn Mahone told Reuters.

Orbital did not immediately reply to a request for comment.

News of the payment marks another setback for Aerojet days after United Launch Alliance dumped the company as its solid rocket motor supplier. Instead, the joint venture of Lockheed Martin Corp (LMT.N) and Boeing Co (BA.N) signed a long-term deal with Orbital ATK (OA.N), effective in 2019.

ULA and its owners last week rejected a $2 billion cash offer by Aerojet, which is racing to cut costs and drum up orders for its space business.

An undisclosed part of the one-time, $50 million payment will be covered by insurance, Mahone said, adding that the money will be paid by Sept. 30.

The settlement formally ends Aerojet’s involvement in the Antares rocket program. Orbital last year decided to speed up a previously planned engine replacement program and is working toward a March 2016 debut of the revamped rocket.

Orbital also has purchased two Atlas rocket launches from ULA to fly a pair of Cygnus cargo ships to the station to help bridge the gap.

NASA’s second cargo line, operated by privately owned SpaceX, also is temporarily grounded due to an unrelated accident of its Falcon 9 rocket in June.

The station, a $100 billion research laboratory that flies about 250 miles (400 km) above Earth, is also serviced by Russian and Japanese freighters.

Aerojet shares closed 11 cents lower at $17.44 on the New York Stock Exchange on Thursday, well below a year-high of $24.35 reached in July.

 

 http://in.reuters.com/article/2015/09/25/us-aerojet-orbital-atk-settlement-idINKCN0RP01220150925

Offering more than the company is worth, getting rejected, and upping the bid, when they may not have the money.....desperation......

[Unobscured Vision]

Yeah, really. Makes one wonder what is really going on behind the scenes.

Looks to me as if Aerojet is paying back Orbital for the unused engines, and taking them back just so ULA can't have them. That's more dirty pool/shenanigans at work.

If that's the case then the next move we'll see, publicly, is that Orbital no longer has those two Atlas rides to the ISS or the price-per-launch will change drastically upward. And yes, I realize that they'd be stabbing Orbital in the back (their new SO-SRB Provider) somewhat, but Orbital needs to be careful here. They just got their new Services and Goods Contract signed, and they don't need a disruption if someone else was counting on those 10 extra engines ... even if it is sleeping with OldSpace, you don't bite the hand that you're doing business with.

Orbital was smart to make that deal with ULA/Lockheed-Martin, and while I'm all for NewSpace 150% I actually like companies being run smartly and looking at money more. 

[Draggendrop Veteran]

Quite true....SpaceX and "newspace" startups are a real threat to them, and they know it. The only way to survive , is to be competitive....an alien concept. for them over the last decade, at least......

How could someone, make a 2 billion dollar offer, on 2 lines of an email.....and get the press coverage, unless it was a setup for something.....who knows?, I gave up on figuring this mess.....

[DocM]

What a soap opera....and its just beginning.

[DocM]

Oopsie

http://spacenews.com/orbital-atk-settlement-drags-down-aerojet-rocketdyne/#sthash.85mmnS0v.dpuf

Orbital ATK Settlement Drags Down Aerojet Rocketdyne

WASHINGTON — Aerojet Rocketdyne’s losses widened during the third quarter of 2015 compared with the same period last year due in part to its $50 million settlement with Orbital ATK stemming from last October’s failure of the latter’s Antares rocket.

In an Oct. 13 press release, Sacramento, California-based Aerojet Rocketdyne also said it has spent $24 million so far this fiscal year working on its AR1 engine, which the company has proposed as a replacement for the RD-180, the main engine on United Launch Alliance’s government workhorse Atlas 5 rocket. Congress has mandated that the Pentagon stop using Russian-made engines to launch its satellites, but ULA has made Blue Origin’s BE-4 the leading replacement candidate.

During the three-month period ending Aug. 31, Aerojet Rocketdyne reported a net loss of $38.1 million on $440.5 million in net sales. The company lost $10 million during the 2014 third quarter, owing largely to a $17.5 million loss related to its contract to supply Orbital ATK with AJ-26 engines, one of which failed on a test stand earlier that year.

The AJ-26, the main engine on Antares, has been blamed in the Oct. 28, 2014, failure of that vehicle, which destroyed a load of cargo bound for the International Space Station. Aerojet in September announced it has settled with Orbital ATK over the engine’s role in the failure, which ultimately led to Orbital ATK selecting a different Russian-made engine for Antares.

Aerojet Rocketdyne also cited a $29.5 million environmental remediation expense as a contributor its losing quarter.

Solid rocket motors, primarily for U.S. missile defense programs, continue to be Aerojet Rocketdyne’s largest source of revenue. The company booked $61.2 million and $55.6 million on the Theater High Altitude Area Defense and Standard Missile programs, respectively, during the quarter, with both figures representing substantial increases over the same period last year.

The company also reported $50.2 million in net sales from the RS-25 engine being developed for NASA’s Space Launch System heavy-lift rocket program, a 70 percent increase over the 2014 third quarter. Net sales on NASA’s Orion capsule were $20.1 million, up by more than 30 percent.

But Aerojet’s business with ULA, for which it supplies RL-10 upper-stage and RS-68 main-stage engines, was down sharply during the quarter. Net sales on the RL-10 were $26.8 million, a decline of nearly 30 percent, while for the RS-68 net sales were $24.9 million, down by more than 30 percent.

[Draggendrop Veteran]

I imagine that the thought of  "earning" a living, once the main trough dries, is a new concept to them. The missile market will probably still be theirs but newspace will handle the big stuff. I doubt they will make a living off of SLS.     

[Unobscured Vision]

Whoops. Looks like someone(s) on the Board miscalculated ... ouch.

What's funny is they actually made the offer for ULA, but never had the stroke (let alone the bankroll) to complete a deal like that.

Yeah ... Aerojet is *done*. The Strap-on Booster deal between ULA and Orbital has made sure of that.