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Technology Stocks : Loral Space & Communications -- Ignore unavailable to you. Want to Upgrade?

To: donss who wrote (4612)	9/20/1998 6:03:00 PM
From: Valueman	Read Replies (1) \| Respond to of 10852

Lockheed Martin to Acquire Comsat for $2.7 Billion Bethesda, Maryland, Sept. 20 (Bloomberg) -- Lockheed Martin Corp., the world's largest defense company, will buy Comsat Corp., one of the world's largest satellite services companies, for $2.7 billion, creating an entity capable of manufacturing, launching and operating commercial satellites. The first phase of the cash takeover, for $45.50 per share, represents a 33 percent premium over Comsat's Friday's closing price of 34 1/8. The acquisition, which is subject to congressional approval, gives Lockheed Martin entry to the telecommunications services business. Because it owns its own launch rockets, the agreement will also give the company a competitive advantage over rivals Loral Corp. and Hughes Electronics Corp., which make satellites and provide services, analysts said. ''This initiative will unite two advanced technology companies with complementary capabilities in the commercial space- based telecommunications industry,'' said Lockheed Martin Chairman Vance Coffman. Shares of Comsat Corp., a provider of satellite services that's also based in Bethesda, fell 5/8 to 34 1/8 in trading Friday after rising from 29 3/4 Sept. 2 on speculation it was a takeover candidate. Comsat's stakes in Intelsat, a satellite network that transmits international phone calls and Inmarsat, a satellite system that provides mobile communications for maritime uses, made it an attractive acquisition for Lockheed Martin. In the first phase of the transaction, Lockheed Martin within five days will begin a cash tender offer to purchase up to 49 percent of the outstanding common stock of Comsat, at a price of $45.50 per share, with an estimated value of $1.3 billion, the companies said. The second phase of the transaction involves the merger of a new Lockheed Martin telecommunications subsidiary with Comsat. That's worth $1.4 billion and is contingent on the passage of federal legislation to remove long-standing restrictions on ownership of Comsat voting stock.