Pentagon Warns On M&A But Bomber May Cause Them Anyway

http://news.investors.com/business/100115-773601-as-pentagon-warns-mergers-may-still-happen.htm

Pentagon Warns On M&A But Bomber May Cause Them Anyway
BY GILLIAN RICH, INVESTOR'S BUSINESS DAILY
10/01/2015 04:16 PM ET

The Pentagon warned against mergers in the defense industry after Lockheed Martin (NYSE:LMT) got approval to buy Sikorsky Aircraft, but an upcoming contract award for a new stealth bomber contract could lead to consolidation in the industry anyway.

Defense Secretary Ash Carter, who had been the Defense Department's top arms buyer in 2011, said Wednesday that he didn't want to see too much consolidation.

"What I said then and still believe is that it was important to avoid excessive consolidation in the defense industry to the point where we did not have multiple vendors who could compete with one another on many programs," he told reporters.

~snip~

Because of the secretive nature of the selection process, the contest is seen as a toss-up. Earlier, Citi said Lockheed's involvement could work in Northrop's favor, because the DoD might not give Lockheed, which is already building the F-35, another major project. Boeing's mistakes in developing the KC-46 aerial refueling tanker could also hurt its chances of winning the deal.

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The last new bomber we have is the $3 billion dollar B-2. Why would anyone consider building another bomber that will cost at least[/] $3 billion dollars?