News

FOR IMMEDIATE RELEASE AT

MONDAY, MARCH 23, 1998 (202) 616-2771

TDD (202) 514-1888

ATTORNEY GENERAL RENO'S STATEMENT REGARDING

THE CHALLENGE OF THE LOCKHEED MARTIN/NORTHROP GRUMMAN

MERGER


"Good Afternoon.

Competition is the lifeblood of a free market economy. It produces better products, innovation and lower prices for consumers. This Administration's antitrust enforcement policy has been based on a simple principle: in a fast-moving global economy, our nation cannot afford anything less than full-blooded competition.

That is why we asked a federal court in Washington, DC today to prevent the merger of the Lockheed Martin Corporation and the Northrop Grumman Corporation -- two of the largest suppliers of defense systems to the U.S. military. This is the single largest merger ever challenged.

In our complaint we allege that the proposed merger would substantially reduce competition in many areas of vital importance to America's national defense. It would cost taxpayers more and take the competitive wind out of the sails of innovation in the production of many critical systems that protect our fighting men and women.

The defense industry is already highly concentrated. If this merger were to go forward, America could face higher prices and lower quality in advanced tactical and strategic aircraft, airborne early warning radar systems, sonar systems, and several types of countermeasure systems that save our pilots from being shot down when they are flying in hostile skies.

This merger isn't just about dollars and cents. It's about winning wars and saving lives. That's why the investigation of this merger has been conducted jointly by both the Justice Department and the Department of Defense.

Together, we want to insure that any defense merger protects our soldier's lives and our taxpayers' wallets. Our message is simple: If a merger does not encourage strong competition, it is not in America's interest."

###




98-132