Titan Corp on Friday said US regulators' staff planned to recommend civil action against the technology services provider in connection with a probe over whether its consultants or subsidiaries bribed foreign officials.
The development is the latest threat to the company's deal to be acquired by Lockheed Martin Corp, which in April had threatened to pull out of the arrangement if the government's probe into the alleged bribery was not resolved.
Titan said it had received a Wells notice from the US Securities and Exchange Commission, which indicates that SEC staff intend to recommend enforcement action against the company for violating securities laws.
Titan said it intends to respond promptly to the agency and continues to co-operate with the SEC and a separate criminal inquiry by the US Department of Justice.
In April, Lockheed Martin Corp cut its offer for Titan by 9 percent to $1.64 billion and said Titan must obtain written confirmation that the Justice Department would not pursue claims against Titan before the defence contractor would agree to buy the government information technology specialist.