Boeing and Lockheed Martin Settle Differences and Create JV
Boeing and Lockheed Martin are teaming up to make rockets for the United States military.
The two companies are creating a joint venture to be called United Launch Alliance, and will produce rocket launch units for the Air Force and NASA.
There has been a little bad blood between the two companies in the past as Fool.com points out:
“There has long been no love lost between the two defense rivals, but competition in the rocket area took an ugly turn when the U.S. Air Force determined in 2003 that Boeing had stolen secrets from Lockheed in order to win contracts. That finding led the USAF to strip Boeing of $1 billion in rocket deals and ban the aerospace giant from participation in bids for government contracts for 20 months. For its part, Lockheed slapped Boeing with a civil lawsuit.”
It appears that the two companies have let bygones be bygones now as Lockheed is dropping its lawsuit.
The United Launch Alliance is expected to save a lot of money for both companies as well as the Department of Justice; somewhere between $100 million and $150 million.
In midday trading, Lockheed shares were up 42 cents while Boeing was up 43 cents.