Lockheed Martin in Talks to Purchase Terran Orbital

Aerospace and defense titan Lockheed Martin recently disclosed in SEC filings that the company is negotiating the purchase of satellite manufacturer Terran Orbital. The two organizations have a long history of partnership, dating to Lockheed’s participation in Terran Orbital’s seed round in 2017. Lockheed’s current stake in Terran Orbital is about 33%, but it now wants to purchase the company outright.

Who Is Terran Orbital?

Terran Orbital specializes in customized small satellite solutions. With more than 215 successful satellite deployments for government and commercial purposes alike, the company also maintains a global network of ground stations as well as a Mission Operations Center. Terran Orbital provides full-service end-to-end satellite operations.

Terran Orbital’s Financials May Play a Role

The Lockheed-Terran Orbital relationship is long established, so why is Lockheed interested in making this purchase now? Terran Orbital’s financial position may be a factor. Its share price has dropped by a stunning 90% since going public through an SPAC merger in 2022, with shares closing at just $1.07 on March 1^st. If Lockheed wants Terran Orbital to succeed, now may be the right time for a takeover.

Lockheed Looking to Expand Existing Relationship

Purchasing Terran Orbital would also allow Lockheed to expand its relationship with the company. In addition to owning shares, Lockheed utilizes Terran Orbital products for several of its projects. In its letter to the SEC, Lockheed stated that, “In addition to being the largest historical revenue generating customer we are confident that we will continue to be the largest revenue generating customer for Terran for the foreseeable future.”

What This Means for Lockheed Stock

Lockheed Martin is a mature and incredibly profitable company with a nearly unparalleled partnership with the US Department of Defense. Its stock remains consistently high, but significant growth has been challenging for a number of years. This acquisition, though, has the potential to shake things up and lead to a meaningful increase in the company’s stock prices.

Want to stay on top of the latest stock news? Join our SMS alerts here.