Regulatory runway cleared for Ball Aerospace acquisition

WESTMINSTER — Ball Corp. (NYSE: BALL) said this week that it has cleared the final federal regulatory hurdle required for the aluminum-packaging giant to sell its Ball Aerospace and Technologies Corp. division to British aerospace company BAE Systems PLC for $5.6 billion.

“The U.S. Department of Justice has ended its review, and allowed its review period to expire, under the Hart-Scott-Rodino Antitrust Improvements Act of 1976,” Ball said. The Defense Counterintelligence and Security Agency and the Committee on Foreign Investments had already signed off on the deal.

“In the coming days, BAE Systems and Ball Corporation will be executing the steps needed to complete the transaction and close on the Ball Aerospace acquisition,” BAE said in a news release. 

Once absorbed, Ball Aerospace will operate as a new BAE business unit called Space & Mission Systems, led by Dave Kaufman, Ball Aerospace’s current president. 

“This acquisition underpins our strategy to deliver growth and advance our technology and innovation portfolio in high priority areas identified in the U.S. National Defense Strategy and the U.S. Intelligence Strategy,” BAE CEO Tom Arseneault said in the release. “Together we will leverage our combined capabilities to develop and deliver cutting-edge space, science and defense solutions to advance our customers’ critical missions.”

The deal will allow Ball to focus on its core aluminum business, company leaders said when the deal was announced last summer. 

Ball CEO Daniel Fishery told investors in August 2023  that “Ball, going forward, will be a pure-play aluminum packing leader.” 

Ball leaders said at the time that they plan to use proceeds — after taxes, the windfall is expected to be $4.5 billion — to buy back stock and provide shareholders with dividends. The deal will also help Ball reduce its debt.

“Aerospace is not a hugely cash-generative business,” Fisher said last year, and offloading the division allows Ball to focus on its can manufacturing business. 

The story of Ball Aerospace goes back 53 years to 1956, when Ball Brothers Research Corp., as the company was then known, took Boulder city officials up on their push to recruit companies to a new industrial park east of town. 

Upon arriving in town, staff with Ball Corp., then based in Muncie Indiana, learned about local scientists doing military research on space exploration at the University of Colorado in what would later be known as the Laboratory for Atmospheric and Space Physics.

They had discovered how to build a stable platform to attach equipment and cameras to rockets sent into the upper atmosphere. Ball’s Boulder team, led at the time by R.C. “Merc” Mercure, saw an opportunity. 

By 1959, the company had built the nation’s first orbiting solar observatory for a new government agency called the National Aeronautics and Space Administration, or NASA.

More than six decades later, nearly 1,000 Ball Aerospace employees work from the company’s Boulder campus, a total that could roughly double in the next 10 years with the expansion of Ball’s Arapahoe Road operations. Ball and BAE have been mum on what impact the acquisition will have on the Boulder expansion effort.

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