Lockheed Martin to Acquire Terran Orbital for $450 Million

Lockheed Martin announced on Thursday its agreement to acquire Terran Orbital, a struggling spacecraft manufacturer, at an enterprise valuation of nearly $450 million. This acquisition, which will take Terran private, comes at a lower valuation than Lockheed's previous bid in March. The deal is expected to close in the fourth quarter of 2024 and aims to help Terran navigate a significant cash-and-debt crisis. Terran Orbital has been facing financial difficulties, with cash reserves reported at less than $15 million as of the end of July, alongside approximately $300 million in debt. The company, which went public in early 2022 with a valuation of $1.8 billion through a special purpose acquisition company (SPAC), has struggled in the current market environment, which has adversely affected many space stocks. Lockheed Martin, already a major stakeholder in Terran, has previously invested during the SPAC process and again in late 2022. The defense giant is also a crucial customer for Terran, accounting for 70% of the company’s revenue, which totaled $30.4 million in the second quarter. In a recent filing, Terran Orbital announced the removal of the Rivada deal from its contract backlog, resulting in a dramatic reduction of orders from $2.7 billion to $312.7 million. This acquisition by Lockheed is seen as a strategic move to stabilize Terran's operations amid ongoing financial challenges.