The U.S. Department of Justice's Antitrust Division has announced that Safran, S.A. and Safran USA Inc. must divest their North American actuation business and related assets to proceed with their proposed acquisition of Collins Aerospace's actuation and flight control business from RTX Corporation. This decision comes in light of antitrust concerns that the acquisition would reintroduce assets previously divested during the settlement of United Technologies Corporation's acquisition of Rockwell Collins in 2018.

The Antitrust Division has filed a civil lawsuit in the U.S. District Court for the District of Columbia to block the transaction, while simultaneously proposing a settlement that, if approved, would alleviate competitive concerns. Assistant Attorney General Abigail Slater emphasized that the divestiture is a structural solution aimed at preserving competition in the market for critical aircraft components, which are essential for passenger safety.

Safran and RTX are key players in the market for trimmable horizontal stabilizer actuators (THSAs), which are vital for maintaining aircraft altitude during flight. The merger without the divestiture could lead to increased prices, decreased quality, and reduced innovation, negatively impacting customers and consumers. The divestiture includes assets that Safran acquired under the 2018 settlement, which have been operated as a competitive entity in the THSA market.

The settlement requires Safran to divest its North American actuation business, including THSAs and secondary flight control actuators, to Woodward Inc., a well-established American aerospace company. The divestiture will also encompass the necessary tangible and intangible assets for producing and selling these components. Woodward is expected to retain key employees from Safran to ensure continuity in the business.

The Antitrust Division collaborated with the European Commission and the Competition and Markets Authority during their investigations. Safran, headquartered in Paris, France, is a major player in the aviation, space, and defense sectors, while RTX, based in Arlington, Virginia, is a leading provider of aerospace and defense products.

As per the Tunney Act, the proposed settlement and the Department's competitive impact statement will be published in the Federal Register, allowing for public comments within 60 days. The court will finalize the judgment based on public interest considerations.