By chatnewstv.com
WASHINGTON — In an unprecedented move to shore up the nation’s munitions industrial base, the Department of War announced Tuesday a $1 billion direct investment into L3Harris Technologies’ missile division to accelerate the production of solid rocket motors.
The deal marks the first time the department has utilized a “direct-to-supplier” partnership of this scale. Under the terms of a signed letter of intent, the DoW will make a $1 billion convertible preferred equity investment in L3Harris’ Missile Solutions business. As part of the transaction, the unit will be spun off into a separate, publicly traded company with an initial public offering planned for the second half of 2026.
The investment is designed to modernize facilities and eliminate “single points of failure” in the domestic supply chain for critical missile programs, including the PAC-3, THAAD, Tomahawk, and Standard Missile.
“We are fundamentally shifting our approach to securing our munitions supply chain,” said Michael Duffey, Under Secretary of War for Acquisition and Sustainment. “By investing directly in suppliers, we are building the resilient industrial base needed for the Arsenal of Freedom.”
The initiative is the flagship result of the department’s new Acquisition Transformation Strategy. By acting as an anchor investor, the government aims to provide the upfront capital and long-term stability necessary for the private sector to rapidly expand capacity.
Solid rocket motors have long been identified as a critical bottleneck in the U.S. defense industry. Since L3Harris acquired Aerojet Rocketdyne—now rebranded as Missile Solutions—the company has worked to increase output, but officials say the $1 billion infusion is required to meet the urgent operational demands of replenishing American stockpiles.
“This direct-to-supplier model is a crucial step toward replenishing stockpiles, rebuilding our military, and reestablishing deterrence by ensuring the availability of critical components,” Duffey said.
The deal also positions the DoW to negotiate multi-year procurement frameworks, pending Congressional approval, which would provide the new company with a sustained demand signal.
The effort was coordinated by the Munitions Acceleration Council, a body established to remove structural barriers to weapons production. The partnership involved several defense components, including the Economic Defense Unit and the Office of Strategic Capital, reflecting a broader shift toward using strategic investment tools to address national security vulnerabilities.
By participating in the 2026 IPO, the U.S. government could potentially see a financial return on its equity, a unique framework intended to benefit taxpayers while securing the “northern flank” of the nation’s defense infrastructure.
