| US defense industry has experienced a huge change since the end of cold war. In the 1990s, with the collapse of Soviet Union, the White House designed a blueprint for the merger & acquisition (M&A) of military industry in order to reduce excessively huge industry scale and therefore enhance competitiveness of American weapons. To explain the issue, the M&A of American military enterprises is divided into two stages in the paper. The first stage is from 1992 to 1997, and the second stage is from 1998 until now. In the first stage, M&A happened between main-system contractors and several huge military-industrial complexes came into being by M&A during this period, which include Lockheed Martin, Boeing, Northrop?Grumman and Raytheon. Several factors worked during this stage, and these included curtailment of American military budget, impulse of pursuing scale economy and market share, and also stimulation of global industries regrouping and information economy. There are two research clues in the second stage. One clue is M&A between different subcontractors, and another is that main-system contractors merge subcontractors and suppliers. M&A in the two stages embodies typically different characteristics.M&A from 1992 to 1997 shows features as follows. First of all, governmental intervention functioned deeply through these activities. M&A of American defense industry was strongly supported by US government, which included preferential propping up of weapons stocking, broadening of anti-monopoly regulations and fostering mature market system. Second, bargaining amount of M&A was immense and rate of industry regrouping was speedy. The third, M&A between main-system contractors was dominant. Trend of concentration was distinct, and many leading defense enterprises lost their corporation status after being merged, becoming branches or multinational divisions of merging enterprises. The fourth, ways of M&A were varied and friendly acquisition was predominant. Compared with the first stage, the second stage shows different features as follows. First, main bodies of M&A and dealing amount vary. M&A of defense industry after 1998 involves the whole "Pyramid" structure. And dealing amount is not so immense comparatively. Second, subcontractors are merging craft brothers. There are two reasons of why subcontractors are anxious to merge craft brothers. One reason is that main-system contractors are interested in dealing with fewer subcontractors for considerations of reducing bargaining expense. Another is Competitive subcontractors want to protect themselves by merging and prevent being merged by main-system contractors. The third, main-system contractors merge and purchase subcontractors and suppliers, which is influenced by American anti-terrorist wars and information war etc. The fourth, ways of M&A are mostly stock-permutation and cash M&A. In the long run, stock-permutation and cash M&A will all play important roles in the M&A of American defense industry, while proportion of stock-permutation will increase slowly, and to what extent will proportion of stock-permutation is determined by American stock market and anticipation of investors to American economy. It is far-reaching about the influence of M&A tidal wave of American defense industry since 1990s. More powerful defense enterprises have come into being and international Competitiveness of American defense industry enhances as a result. However, M&A also leads to the protectionism of span-Atlantic military industry and therefore block the cooperation and credit among USA-EU defense enterprises. In the long run, the two clues mentioned in the first sentence will continue to be the M&A trend of American military industry, while the road of cooperation by merger and acquisition of span-Atlantic will not reach too far. Moreover, joint investment of USA-EU defense enterprises is more practical and optimistic, and competition of global arms sale will be more cruel. In the paper, I use positivism mainly to analysis cases and hope to get some commo...
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