AE Industrial to Acquire Majority Stake in L3Harris’ Space Propulsion & Power Business – “Rocketdyne”

Key Terms

upper-stage rocket engines technical

Upper-stage rocket engines are the propulsion systems used after a launch vehicle's first stage separates, responsible for accelerating the payload into its final orbit or trajectory and performing precise course adjustments. Think of them as the rocket's overdrive or fine-control engine: they work more efficiently, can sometimes be restarted, and determine how accurately and reliably a satellite or spacecraft reaches its destination. Investors care because their performance and reusability directly affect launch success rates, payload capacity, operational costs and the competitiveness of launch services.

in-space propulsion technical

In-space propulsion is the technology that moves and maneuvers spacecraft once they are already in orbit or traveling through space, using engines or systems that push the vehicle without relying on Earth-based rockets. It matters to investors because it directly affects a satellite or spacecraft’s operational life, fuel costs, payload capacity and the ability to perform new missions—much like a car’s engine determines how far and efficiently it can drive after leaving the dealership.

nuclear propulsion technical

Nuclear propulsion is a method of powering ships or spacecraft by using heat from a controlled nuclear reaction instead of burning traditional fuels; think of it as a stove that heats water or propellant to create thrust rather than a gasoline engine. For investors, it matters because it can offer much longer range, lower ongoing fuel costs, and unique performance advantages but also brings high upfront costs, specialized suppliers, regulatory hurdles and long development timelines that affect risk and returns.

cislunar domain technical

The cislunar domain is the region of space between Earth and the Moon, including the orbits and transit routes used by spacecraft, satellites and cargo. It matters to investors because control of that “highway and ports” zone affects communications, navigation, national security, satellite services and access to potential resources—so companies building rockets, satellites, logistics or ground infrastructure there can create new markets and risks for portfolios.

avionics technical

Avionics are the electronic systems used on aircraft and spacecraft for navigation, communication, flight control, monitoring and onboard displays — think of them as the vehicle’s brain, dashboard and radio all in one. Investors care because avionics determine safety, certification requirements, upgrade cycles, and maintenance costs; changes or innovations in avionics can affect manufacturer competitiveness, supplier revenue and the timing of deliveries.

L3Harris will retain significant stake in the key strategic national asset

BOCA RATON, Fla.--(BUSINESS WIRE)-- AE Industrial Partners, LP (“AE Industrial”), a private investment firm focused on technologies and services considered critical to aerospace and national and economic security, today announced that it has acquired a controlling interest in the Space Propulsion and Power Systems business of L3Harris Technologies (NYSE: LHX). The transaction encompasses business units across five locations in the U.S., which have developed the upper-stage rocket engines used in national security, civil and commercial missions for more than 60 years, as well as in-space propulsion, nuclear power and avionics assets.

L3Harris will retain a minority investment interest and continue to act as a strategic partner to the business. AE Industrial plans to restore and use the “Rocketdyne” name for the acquired business in recognition of its heritage and longstanding innovation within space propulsion technology.

“Rocketdyne is more than just a company, it is the birthplace of U.S. rocket propulsion," said Kirk Konert, Managing Partner at AE Industrial. “This transaction will not only modernize and give new life to a pioneer of space and national defense technology, but it will also create a new hybrid model of agile collaboration, combining the stability and power of a national defense prime with the innovation of a specialized investor. By taking the historic engine – the RL10 – and applying modern manufacturing discipline, we will honor its design while revolutionizing the production line.”

The partnership between AE Industrial and L3Harris will also aim to help accelerate the development of future propulsion technologies, including nuclear propulsion, which will be critical to the exploration of Mars and the cislunar domain. Maintaining American dominance in space depends on leveraging top engineering talent to ensure the U.S. retains the strategic high ground through superior speed and maneuverability.

“Our strategy is to identify critical technologies and build them into world-class companies,” said Jon Lusczakoski, Principal at AE Industrial. “Rocketdyne’s unparalleled heritage offers the perfect foundation for this mission. We see a unique opportunity to apply our deep experience in scaling space systems to this iconic business—ensuring Rocketdyne remains a critical pillar of national security while aggressively evolving to meet the demands of the future.”

“The acquisition of Rocketdyne demonstrates AE Industrial’s continued commitment to investing in the national security space and space exploration markets,” said David Rowe, Co-CEO and Managing Partner at AE Industrial. “Current and previous space investments of AE Industrial include American Pacific Corporation, Calca Solutions, Firefly Aerospace, Redwire Space and York Space Systems. All of these companies are critical market leaders, and the addition of Rocketdyne is a perfect fit to AE Industrial’s strategy and portfolio construction.”

About AE Industrial Partners

AE Industrial Partners is a private investment firm with $7.5 billion of assets under management as of September 30, 2025, focused on investing in technologies and services considered critical to national & economic security. Since 2015, AE Industrial has completed more than 140 investments in market-leading companies that benefit from its deep industry knowledge, operating experience and network of relationships across the sectors where the Firm invests (national security, aerospace and industrial services). With a commitment to driving value creation in partnership with the management teams of its portfolio companies, AE Industrial invests across private equity, venture capital and aerospace leasing. AE Industrial is headquartered in Boca Raton, FL, and has an office in Washington, D.C. Learn more at www.aeroequity.com.

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Source: AE Industrial Partners, LP