L3Harris Sells Majority Stake In Space Propulsion Unit

L3Harris Technologies, Inc. (NYSE:LHX) announced on Monday that it has agreed to sell a controlling interest in its Space Propulsion and Power Systems business to AE Industrial Partners, a private investment firm focused on aerospace and national security technologies.

The transaction shifts operational control of a key U.S. propulsion supplier while allowing L3Harris to retain a significant minority stake.

The sale includes propulsion, power, avionics, and nuclear-related assets across five U.S. locations. AE Industrial plans to restore the Rocketdyne name, highlighting the unit’s long-standing role in U.S. space and defense programs.

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Deal Terms

The transaction values the business at about $845 million. L3Harris will retain approximately a 40% ownership interest.  L3Harris’ RS-25 rocket engine business is excluded from the sale. 

The companies expect the deal to close in the second half of 2026, subject to customary closing conditions and regulatory approvals.

Why It Matters

The assets include upper-stage rocket engines used in national security, civil, and commercial missions, as well as in-space propulsion and power technologies. AE Industrial said it plans to modernize manufacturing while preserving capabilities viewed as critical to maintaining U.S. leadership in space.

Kirk Konert, managing partner at AE Industrial, called Rocketdyne “the birthplace of U.S. rocket propulsion,” and said the firm plans to apply modern manufacturing discipline to proven designs.

L3Harris CEO Christopher Kubasik said the transaction aligns the company more closely with Department of Defense priorities while continuing to deliver value for shareholders.

LHX Price Action: L3Harris Technologies shares were up 1.90% at $310.26 at the time of publication on Monday. The stock is trading at a new 52-week high, according to Benzinga Pro data.

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