Titan to Lockheed: Buy Me, Please!

When you consider the lengths that Titan (NYSE: TTN) has gone to, the hoops it has jumped through, and the humiliations it has endured in convincing Lockheed Martin (NYSE: LMT) to please, please, please buy it out, yesterday's news that Titan's shareholders approved Lockheed's reduced buyout offer of $20 a share should have surprised no one.

Did that sentence drag on just a bit too long? Well, the Lockheed/Titan saga has been dragging on far longer. So far, it's been nine months since the defense contractors first agreed to hook up and you have to imagine that the pre-announcement courtship started earlier still. In all, this deal has probably been in the works for well over a year -- yet it still is not a sure thing.

Technically, Lockheed can still back out of the deal if Titan fails to either (1) work out a plea agreement with the Department of Justice or (2) obtain written confirmation that Justice considers the case closed and will not prosecute Titan for alleged violations of the Foreign Corrupt Practices Act (read all about this here and here).

The fact is, however, that there is very little chance of Titan failing to plead guilty if it cannot convince Justice to drop the case. At this point, Titan has done everything but sacrifice its first-born subsidiary in an effort to appease the merger gods and get this deal done.

Meanwhile, a June 25 deadline for completion looms larger and larger every day. If the transaction is not finalized in time, then that, too, will give Lockheed an out if it decides to abandon its bid for Titan. While I have written several times now why I think the sale will proceed come hell or high water, Titan has shown itself to be anything but certain of this.

The market apparently disagrees with me, discounting Titan's stock by nearly a percent yesterday, in response to the SEC's official decision to civilly prosecute the company under the FCPA. Still and all, I expect that within the next 17 days, we will see Titan settle all SEC and DOJ charges against it and soon thereafter ink the deal with Lockheed. My only caveat: If the government stalls on making the plea agreements, then Lockheed and Titan will probably postpone the June 25 deadline considerably.

Fool contributor Rich Smith owns no shares in any company mentioned in this article.