Competing bids for Newport News Shipbuilding Inc. remain under review by the Defense Department and a final recommendation is several weeks away. General Dynamics Corp. on Monday said more than half of Newport News' shares had been tendered in response to its $2.1 billion takeover offer, but Northrop Grumman Corp. continues to press its own bid, saying it alone can get antitrust clearance.
Defense Undersecretary Edward Aldridge, asked if both bids for the warship builder were still under review to assess their impact on defense readiness and cost, said, "Both are viable options."
Aldridge, speaking before testifying to Congress on advanced weapons research, said he would ultimately make a recommendation in consultation with Defense Secretary Donald Rumsfeld.
Completion of the Pentagon's review is "probably still several weeks away," Aldridge said. The report would then be forwarded to the U.S. Justice Department, which is weighing whether the deals pass antitrust muster.
Falls Church, Va.-based General Dynamics on Monday said about 20.2 million Newport News shares -- more than half of the total outstanding -- had been tendered in response to its $67.50-a-share tender offer
. It has extended its offer to July 6.
Northrop contends the General Dynamics deal cannot sail under U.S. antitrust law because it would unite the only two U.S. makers of nuclear-powered warships -- Newport's nuclear aircraft carriers and General Dynamics' submarine business.
General Dynamics counters that there is really no competition among submarine and aircraft carrier builders anyway and that the Northrop deal could lead to a monopoly in large surface ship construction. - (Reuters)