Lockheed Martin to take Terran Orbital private in $450 million deal | Wilnesh News

Lockheed Martin Buying Terran OrbitThe company announced Thursday it reached a deal with the defense giant to take the troubled spacecraft maker private.

Under the agreement, Lockheed will acquire Terran at an enterprise valuation of nearly $450 million, down from the nearly $600 million Lockheed offered in March.

Lockheed will acquire Terran Orbital’s outstanding common stock for 25 cents per share in cash. In addition, Lockheed will repay Terran’s debt and establish a $30 million capital facility to sustain the company’s operations during the closing of the transaction.

Terran’s stock closed at 40 cents a share on Wednesday.

The deal, expected to close in the fourth quarter, will help Terran avoid the cash and debt cliff the company faces. Terran reportedly had less than $15 million in cash reserves as of the end of July. a filing On Monday, the company still had about $300 million in debt.

The small spacecraft maker went public through a special purpose acquisition company in early 2022 at a valuation of $1.8 billion. Like several other space stocks that have come public over the past few years, the pre-profit company has been hit hard by changes in the market risk environment.

Lockheed Martin is already a significant shareholder in Terran Orbital, buying into the company during its SPAC process and again in late 2022. 70%.

18 months ago, Terran signed a blockbuster spacecraft production contract with future satellite communications operator Rivada Space Networks, worth US$2.4 billion, to produce 300 satellites. But the deal has yet to generate meaningful funding for Terran, with only $6.2 million reportedly recognized from the Rivada deal in the first half of this year.

On Monday, Terran said it would remove the Rivada deal from its total contract backlog, which reduced the backlog by 88% from $2.7 billion to $312.7 million. Of the non-Rivada orders, 91% of Terran’s contracts are for “Lockheed Martin-related projects.”