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Boeing Agrees To Settle Antitrust Case in Rockwell Merger

December 5, 1996

WASHINGTON (AP) _ The Boeing Co. has agreed to restrict its space-launch business and to give up work on an unmanned high-altitude aircraft in order to settle federal antitrust charges, the Federal Trade Commission announced Thursday.

The FTC had charged that Boeing’s $3 billion acquisition of Rockwell International’s aerospace and defense businesses could violate antitrust law by reducing competition in the two types of business.

Boeing and Lockheed Martin are current partners in a project to build a high-altitude, endurance, unmanned aircraft for the Defense Department. Competing with them is a project by Teledyne Ryan, which includes Rockwell as manufacturer of the craft’s wings.

By acquiring Rockwell, Boeing became part of both projects and could increase the price of components it supplied or reduce its investment, the FTC said.

Under terms of the settlement Teledyne Ryan will be permitted to replace Rockwell as a supplier at no cost, and Boeing will be required to provide Teledyne Ryan with the components, tooling, engineering and design data and technical help to produce the wings.

The merger also would put Boeing in the position of being both a builder of space launch vehicles and a supplier of propulsion systems used in those vehicles. Suppliers of propulsion systems need access to proprietary data from builders of the vehicles, which could give the company access to information about its competitors, the FTC said.

The settlement forbids Boeing from making any information obtained as a propulsion supplier available to its launch-vehicle division.

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