Graham Warwick/ATLANTA

LOCKHEED MARTIN says that it is responding to "...three unrelated federal subpoenas seeking information...on its use of consultants on foreign sales".

Documents requested concern the sales of F-16s to South Korea and at least five other countries since 1990, plus the sale of P-3s to South Korea and electronic equipment to Taiwan.

Federal grand-jury investigations, now under way, are believed to result from a 1993 bribery and influence peddling scandal in South Korea and a previous case involving a consultant in Taiwan. Teledyne pleaded guilty in 1993 to paying more than $3 million in illegal commissions to the consulting firm, which was used by other US companies, including Lockheed Martin's Sanders division.

The company cautions that its acknowledgment of the subpoenas should not be interpreted " an admission of wrongdoing or a signal that Lockheed Martin is the target of a Government investigation". General Dynamics, which sold its Fort Worth, Texas, F-16 division to Lockheed in 1993, has also received subpoenas but is "not worried".

Lockheed Martin is particularly sensitive to allegations of illegal commissions, having paid $24.8 million to the US Government earlier this year after pleading guilty to bribing an Egyptian politician to arrange the sale of three C-130s to Egypt for $79 million in 1989.

News of the subpoenas over-shadowed a report by Lockheed Martin chairman, Dan Tellep, on progress made since the two companies announced their plans to merge in August 1995. Tellep says that consolidation actions announced in June will save $6 billion over the next five years and yield annual savings of $1.8 billion thereafter.

As part of the consolidation plan, the company has formed the Astro Space Commercial operating unit to handle the consolidation of the former Lockheed and Martin Marietta commercial-satellite businesses at Sunnyvale, California. Military-spacecraft operations are being consolidated with the Missiles & Space business, also at Sunnyvale.

Source: Flight International