Defense News quotes M.A. and George Lund Fellow for Emerging Defense Challenges Steven Grundman on Pentagon Acquisitions Chief Frank Kendall’s announcement to deter more consolidation of top defense contractors:
Steve Grundman, a former Pentagon industrial policy chief who is now a consultant and a member of the Atlantic Council, said if the Pentagon wants to stop private companies from conducting a transaction, it either needs a legal basis or enough power to push back. Legislative relief from Congress may be the more difficult option, he said.
“I think he’s going to have a much harder time getting new law to address the kinds of concerns that he described. However, if you want to be a defense contractor, the DoD is the biggest, baddest customer there is,” he said. “He may have better luck working it through policy choices, and acquisition choices and acquisition strategies.”
But there is a certain amount of risk attached to Kendall’s efforts, he said.
“One risk is that he actually, perhaps inadvertently, has imposed less rather than more clarity about the government’s merger policy toward defense firms,” Grundman said. Alternatively, “he could have his bluff called, and that’s not good for his stature and authority.”