Bethesda, March 9: Lockheed Martin and Northrop Grumman were informed over the weekend by the department of justice that the government is "fundamentally opposed" to their proposed merger, the two companies said early on Monday.The companies have agreed not to close the $11.6-billion deal until March 24. Shareholders of both companies have approved the deal, which the companies said in February would close before the end of the first quarter.
"If the companies' attempts to resolve the department of justice concerns are not successful, it is anticipated the government will move to block the transaction," said Vance Coffman, Lockheed Martin vice chairman and chief executive and and Kent Kresa, Northrop Grumman's chairman and chief executive, in a statement.
Both executives said in the statement they will "vigorously oppose" any attempt to block the transaction and they continue to believe significant savings of $1 billion per year are available from the merger.
