Loral Space to hire 600
PALO ALTO UNIT TO GIVE LAID-OFF WORKERS PRIORITY
By Karl Schoenberger
Mercury News
In a bright note for Silicon Valley's depressed job market, Loral Space & Communications said Thursday it plans to hire 600 new employees over the next 18 months at its Palo Alto subsidiary now that it is emerging from bankruptcy.
The Space Systems/Loral subsidiary, which designs and makes communications satellites, is expected to add 200 new jobs by the end of this year and an additional 400 next year at its Palo Alto campus, up from the current workforce of 1,450, said spokeswoman Jeanette Clonan.
Most of the new opportunities will be for aerospace engineers, said SS/L President Pat DeWitt, who expects the subsidiary's revenue to grow by 15 percent this year and 20 percent next year. By the end of 2007, he hopes to return to the 3,000-strong workforce Loral had in Palo Alto before the New York-based company filed for bankruptcy, in July 2003.
The parent company announced Monday that the U.S. Bankruptcy Court for the Southern District of New York had confirmed its reorganization plan to exchange bond debt for equity and allow Loral to become publicly listed under current management. Loral was previously listed on the New York Stock Exchange but will seek a listing on Nasdaq.
Space Systems/Loral -- Loral acquired it from Ford Aerospace in the early 1990s -- has remained profitable throughout the financial crisis and will be debt-free under the reorganization plan, which still needs final approval from the court and the Federal Communications Commission.
The bankruptcy was precipitated by Loral's $3 billion investment in Globalstar, the failed San Jose satellite telephone network, and not by poor performance in his division, DeWitt said. The subsidiary had sales of about $1 billion in 2003.
``Our historic customers have shown a tremendous amount of faith in the company, and they've seen we've maintained our talent,'' DeWitt said. ``And our workforce has been loyal, staying with us for 20 years or more. Our employees have a passion for what they do.''
He said he would put priority on hiring back laid-off workers.
Space Systems/Loral received as many as nine new orders for satellites during the past two years, four of those since January, DeWitt said. In dollar terms, the company commanded a 40 percent market share during the first seven months of the year -- besting rivals Boeing and Lockheed Martin, he said.
Christopher Baugh, president of North Sky Research, expressed skepticism about Loral's comeback on the strength of its Space Systems subsidiary's new orders.
``The industry has had its ups and downs in the past five years,'' he said. ``We don't expect huge growth, and I can't verify the new orders that Loral is talking about. I have to see it to believe it. I think they may be trying to push up the buzz factor.''
But Loral executives described the company's emergence from bankruptcy as a ``success story'' that was made possible by devoted customers and employees.
``We are grateful for the support of our employees, customers, suppliers and business partners during the reorganization process,'' Loral's chief executive, Bernard L. Schwartz, said in a statement Monday. ``Thanks to their loyalty, Loral has managed over the past two years not only to maintain but to strengthen its critical skills, trim costs significantly and win new contracts and customers despite the challenges inherent in the chapter 11 reorganization process.''
Schwartz said the approved plan enables Loral ``to harness the positive momentum we've built and capitalize on an improving industry environment. Coming out of Chapter 11, we will have a strengthened balance sheet, little debt, an experienced management team and two core businesses that are technology and service leaders in their respective segments -- all the ingredients needed to build on Loral's recent successes.''
Contact Karl Schoenberger at kschoenberger@mercurynews .com or (415) 477-2500. |
