(Reuters) – Lockheed Martin Corp on Thursday agreed to acquire satellite products maker Terran Orbital in a $450 million deal, months after the defense contractor withdrew its previous offer to buy the company.
Lockheed will pay 25 cents in cash per share, a 37.5% discount to Terran’s last closing price. The company had offered $1 per Terran share in March.
Terrain shares fell about 41% to 24 cents on the New York Stock Exchange.
Lockheed, which invested in Terran’s Series A round in 2017, is its largest customer and currently uses the company’s satellite bus for the U.S. Space Development Agency’s (SDA) transport and tracking layer programs.
“The acquisition strengthens the supplier, with Terran Orbital providing buses to Lockheed’s premium position in the tracking and transport layer of the SDA,” analysts said in a note from Jefferies.
Headquartered in Florida, Terran Orbital engages in satellite design, production, launch planning, mission operations and on-orbit support for space and defense customers.
The transaction is expected to close in the fourth quarter and will pay down Terran’s existing debt and create a new $30 million working capital facility.
A month ago, Terran reported a quarterly net loss of $35.4 million, adding to several quarters of losses since going public in 2022.
Earlier this year, Lockheed Martin was awarded $890 million as part of a $2.55 billion contract with peers L3Harris Technologies and Sierra Space to deliver 18 satellites to SDA as part of its missile tracking program.
(Reporting by Aatreyee Dasgupta in Bengaluru; Editing by Maju Samuel)
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