Lockheed Martin has agreed to purchase satellite products maker Terran Orbital for $450 million. The deal comes just months after Lockheed withdrew a previous bid to take the company private. Lockheed will pay 25 cents per share in cash, a 37.5% discount from Terran’s last closing price.
Earlier this year, Lockheed had offered $1 per share for Terran. Following the announcement, Terran’s shares dropped nearly 41% to 24 cents on the New York Stock Exchange. Lockheed, which has been involved with Terran since its Series A investment in 2017, is Terran’s largest customer.
The defense giant uses Terran’s satellite bus for the U.S. Space Development Agency’s (SDA) transport and tracking layer programs. Analysts from Jefferies noted that the acquisition consolidates a key supplier for Lockheed, allowing the company to strengthen its position in the SDA’s Tracking and Transport layer programs.
Terran Orbital, based in Florida, specializes in satellite design, production, launch planning, mission operations, and on-orbit support for aerospace and defense clients. The transaction, expected to close in the fourth quarter, will retire Terran’s existing debt and establish a new $30 million working capital facility.
Terran Orbital has faced financial challenges, posting a net loss of $35.4 million last quarter, adding to a series of losses since it went public in 2022. Earlier this year, Lockheed Martin was awarded $890 million as part of a $2.55 billion contract alongside L3Harris Technologies and Sierra Space to deliver 18 satellites for the SDA’s missile tracking program.
