WASHINGTON — Satellite manufacturer Terran Orbital announced May 13 that Lockheed Martin has signed a new contract to purchase 18 satellite buses. Lockheed Martin will use the satellite buses to produce 18 satellites for the Space Development Agency’s Tranche 2 Tracking Layer contract.
Terran Orbital is publicizing the new contract the day before earnings, likely in an effort to reassure investors that its partnership with Lockheed Martin remains strong after the defense contractor withdrew its offer to acquire Terran Orbital.
Terran Orbital issued the press release after the stock market closed on Monday. A first-quarter earnings call is scheduled for May 14.
Lockheed Martin announced in January that it planned to use Terran Orbital’s satellite buses after winning an $890 million contract to produce 18 missile warning and missile tracking satellites for SDA — a U.S. Space Force agency building a constellation in low Earth orbit for the Defense Department.
Terran Orbital said at the time of Lockheed Martin’s announcement the details of the agreement had not yet been finalized.
“We’re proud to once again be selected as the trusted space vehicle provider for Lockheed Martin, especially for the SDA’s critical tracking mission,” said Marc Bell, Terran Orbital’s chief executive.
“This continued partnership signifies the confidence Lockheed Martin places in Terran Orbital’s capabilities,” he said.
Lockheed has ordered 106 buses
Terran Orbital highlighted that the new agreement brings the total to 106 satellite buses under contract for Lockheed Martin. Lockheed Martin is a major shareholder of Terran Orbital and said in regulatory filings that its SDA satellite orders account for 81% of Terran Orbital’s backlog.
The new contract announcement comes after a turbulent period for Terran Orbital. On May 2, Lockheed Martin withdrew a $500 million offer made March 1 to purchase the remaining shares of Terran Orbital for $1 each.
Terran Orbital’s stock price fell sharply after Lockheed Martin called off the deal. Lockheed Martin did not publicly discuss the reason for the withdrawal. Analysts have speculated that Lockheed Martin may have had concerns about Terran Orbital’s difficulties with its Rivada Space Networks contract.
Terran Orbital has a large contract with Rivada Space Networks, but hasn’t begun substantial work yet and it’s unclear if it received the $180 million it expected by the end of 2023 as a down payment on the $2.4 billion project.
The company’s stock price hovered around $1.05 on May 13. As long as the share price stays above $1, the company is not in danger of being delisted from the NYSE.
