(Reuters). – U.S. arms producer Lockheed Martin Corp (NYSE) canceled Sunday’s plans to purchase rocket engine maker Aerojet Rocketdyne Holdings Inc for $4.4billion amid stiff resistance from U.S. Antitrust Enforcement.

In late January, the Federal Trade Commission filed a lawsuit to stop the transaction on grounds that Lockheed could use Aerojet’s control to harm other defense contractors. Raytheon Technologies (NYSE 🙂 is a prominent opponent of the planned acquisition.

In late 2020 Lockheed announced the merger. It was criticised because it would allow Lockheed to control solid fuel rocket motors, which is a crucial part of America’s missile industry.

James Taiclet, Lockheed’s Chief Executive, stated that the acquisition would have increased efficiency, speed, and reduced costs for the U.S. Government, but that it was best to terminate the agreement in the interests of its stakeholders.

Aerojet will report fourth quarter earnings this week. It also stated in separate statements that, despite having been dissolved, it expects strong future performance.

A regulatory filing shows that the agreement did not provide for a termination fee in case antitrust regulators oppose the deal. Lockheed spokesmen previously stated that the company didn’t plan to pay any similar payment to Aerojet.

FTC stated that if the deal was to be ruled in favor of the defendants, this would have been the first defense merger case in many decades.

Other critics of the deal included U.S. Democratic Senator Elizabeth Warren, who https://reut.rs/3GMsoOshad asked the FTC to examine the internal firewalls Lockheed said it would put in place to prevent it from gaining a competitive advantage over its peers.

Lockheed stated that Aerojet sold 33% to it and claimed the deal would cut costs for the Pentagon as well as the U.S taxpayer.

Aerojet Rocket motors, such as those manufactured by Aerojet, are utilized in all aspects of the defense system and Stinger missiles.

Aerojet is a manufacturer of liquid and solid rocket propulsion and air-breathing hypersonic engine, as well as electric power, propulsion and propulsion systems for commercial, military, and space applications. The Pentagon, NASA and Lockheed Martin are some of its customers. Raytheon (NYSE) is another customer.