Key points:
- Lockheed Martin made a $100m investment in Terran Orbital
- The companies will also enter into a strategic cooperation agreement
- Terran Orbital shares jumped 36% premarket
Satellite-based solutions company Terran Orbital (NYSE: LLAP) surged over 36% premarket on news Lockheed Martin (NYSE: LMT) has invested $100 million in the company.
The investment will see Lockheed receive convertible notes and warrants issued by Terran Orbital. In addition, the deal will result in the companies entering a new Strategic Cooperation Agreement, which runs until 2035 and with Terran stating it allows them to pursue a broad variety of prospects with Lockheed Martin.”
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Also Read: The Top Defense Stocks To Buy in 2022
The satellite solutions firm told investors in its press release that it will use the proceeds to increase module production, purchase additional satellite assembly space, and for working capital needs while it expands its advanced manufacturing abilities. The advanced manufacturing capabilities were initially planned for Florida’s Space Coast in partnership with Space Florida but have been sped up and will now be based in Irvine, California.
“In today’s market, customers want the industry to determine the leaders that will deliver timely, quality, and affordable solutions across a variety of missions,” said Terran Orbital Co-Founder, Chairman, and Chief Executive Officer Marc Bell.
“This is a continued expansion of our collaboration with Lockheed Martin and complements and accelerates the decision Terran Orbital made amid the lingering supply chain crisis to continue to vertically integrate products and components to facilitate full in-house satellite and manufacturing production. We see the opportunity to dramatically ramp up our capabilities and external product offerings, which we believe will move Terran Orbital toward profitability.”
Premarket Monday, Terran Orbital shares are up 36% at $3.49 per share. They closed Friday’s session at $2.56, putting them down over 74% in 2022.
