Pioneering aerospace firm for sale
Rocketdyne built and maintained the rocket engines for NASA’S space shuttle program, which has been discontinued.
Pratt & Whitney Rocketdyne, the rocket engine manufacturing business in the San Fernando Valley that helped pioneer space exploration in the 1960s, is officially up for sale by its parent company.
With headquarters in Canoga Park, Rocketdyne builds rocket engines at a sprawling 47-acre facility near the Westfield Topanga shopping mall. The company is perhaps best known as the maker of the space shuttles’ main rocket engines. But it also develops engines for military rockets and missiles.
On Thursday, Rocketdyne’s parent company of seven years, Hartford, Conn.-based United Technologies Corp., announced it was selling the company to help finance its $16.5-billion purchase of aerospace supplier Goodrich Corp., which was made in September.
The sale of Rocketdyne comes less than a year after NASA ended its 30-year space shuttle program. Rocketdyne developed, built and refurbished 56 reusable engines for the program. NASA has outlined its engineering design for its next launch system, but the agency has not provided specifics on where the nation will travel in the solar system and when exactly it will conduct such missions.
“Without a national space policy, growth will be limited,” United Technologies Chief Financial Officer Greg Hayes told the company’s annual analysts meeting in New York.
Rocketdyne said it had about $750 million in sales last year and currently has about 2,400 employees nationwide, most in California.
Jim Maser, president of Pratt & Whitney Rocketdyne, said United Technologies’ announcement was not a surprise.
“We’ve been prepared for today’s news,” he said. “I’ve been involved in the process. I don’t see the sale making a major impact on our business strategy.”
The company is no stranger to being sold. Rocketdyne was first formed by North American Aviation after World War II, spurred by the success of the German V-2 missile. North American later merged with Rockwell International, which became part of Boeing. In 2005, Boeing sold Rocketdyne to United Technologies Corp. and merged with its Pratt & Whitney unit.
Now, United Technologies plans to sell Pratt & Whitney Rocketdyne, Clipper Windpower and three Hamilton Sundstrand businesses, which make aerospace components. Company officials said they hoped to raise $3 billion by selling them all, but offered no estimate for the individual companies.
“Rocketdyne will make up the lion’s share of that $3 billion,” said Mike Blades, an aerospace analyst with the research firm Frost & Sullivan. “United is looking to divest the company because they don’t see a lot of demand out there for rockets.”
Since Rocketdyne’s inception, the U.S. space program has been at the core of its business. The company supplied the major engines for the colossal Saturn rocket that put man on the moon. By 1965, there were about 17,700 people working for the company in California.
‘United [Technologies] is looking to divest the company because they don’t see a lot of demand out there for rockets.’
— Mike Blades, an aerospace analyst with the research firm Frost & Sullivan
At the time, rocket engines were mostly one-of-akind chemistry sets — good for one flight only.
But that changed in the early 1970s, when NASA began the space shuttle program. The agency wanted reusable engines to propel the 2,250-ton shuttle assembly as high as 384 miles above Earth.
The company would test its engines in the Santa Susana Mountains, which is now a clean-up site because of health risks associated with soil contaminated by years of rocket and nuclear testing.
Rocketdyne engineers were at the forefront in developing engines in the days of slide rules and drafting tables, before advanced computers took a central role.
Robert Biggs, project engineer at Rocketdyne, told the Los Angeles Times in June about the difficulty in perfecting the technology in the 1970s. “We were wrestling with the technology at the time,” he said. “We had about 20 major accidents, but we finally got it right.”
Once swarming with engineers and technicians toiling on various programs, the storied site in Canoga Park is nearly empty compared with the boom times. And the scores of massive machines once humming and churning out parts for spacecraft now sit dormant.
Much of the workforce has been moved to a larger facility a few miles away on Desoto Avenue.
Rocketdyne still builds engines for the Air Force’s rockets, known as Evolved Expendable Launch Vehicles, to lift its military satellites into orbit.
In addition, the company received good news in September when NASA unveiled its plan to build a heavy launch vehicle capable of sending astronauts beyond low-earth orbit by 2025. The engine manufacturer will supply both the first- and second-stage liquid hydrogen rockets.
“I’m optimistic about our future,” Rocketdyne’s Maser said.
United Technologies stock closed up nearly 1%, or 8 cents, to $86.89.