Shipyard Sale Moving Ahead - WLOX.com - The News for South Mississippi

DEAL COULD BE DONE BY THE END OF THE MONTH

Shipyard Sale Moving Ahead

Defense giant Northrop Grumman Corp. anticipates completing its purchase of Newport News Shipbuilding Inc. this month, now that the Justice Department has issued a decision clearing the way for the merger. The boards of both companies must still approve the deal, but those decisions are expected soon, said Randy Belote, a Northrop Grumman spokesman. Northrup Grumman is the parent company of Ingalls Shipyard in Pascagoula.

Newport News spokeswoman Jennifer Dunn would say only that executives of both companies ``are continuing discussions, and beyond that we don't have any comment.'' Northrop made its $2.1 billion unsolicited stock-and-cash bid to buy the shipyard two weeks after General Dynamics Corp. made an all-cash offer on April 25 for the same amount. Northrop Grumman claimed the General Dynamics bid would eliminate competition and endanger national security, while General Dynamics repeatedly said its merger would save money for the Navy. General Dynamics and Newport News are the nation's only nuclear submarine builders, and Newport News is the only builder of nuclear-powered aircraft carriers. Last month, the Justice Department said it would go to court to block the General Dynamics bid, and the Pentagon said it supported Northrop's bid. On Friday, the Justice Department finished its investigation of the impact of the Northrop bid without opposing the transaction, giving Northrop Grumman a green light to go forward. Kent Kresa, Northrop Grumman's chairman and CEO, said he was pleased with the decisions. ``We believe a combination of Northrop Grumman and Newport News Shipbuilding will serve the best interests of our shareholders, employees and customers as it continues to provide competition in an industry vital to the security and defense of our nation,'' he said. The company would have a combined work force of 97,000 employees, and Newport News would operate as a subsidiary of Northrop Grumman. There are no plans for layoffs as a result of the merger, Belote said. Northrop Grumman shares fell 19 cents Monday to $99.62 on the New York Stock Exchange, while Newport News shares rose 60 cents to $70.

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