Orbital Sciences Value Declines

Orbital Sciences Corporation (OSC), Dulles, may be coming under increasing pressure to accept a buyout offer. Orbital stock value has declined to as low as US$3.75 per share, though Paul Nisbet, JSA Resarch analyst, estimates the value to be higher, at US$14.35 per share. It is considered unlikely that a takeover would occur until problems at Orbcomm reach resolution.

Investors are thought to have been reacting to problems at OrbComm and OrbImage. Orbcomm, of which OSC has a 32% stake, is expected to emerge from Chapter 11 during the first quarter of 2001. Orbcomm’s financial situation may have been stabilized, with its cash-burn rate scaled from US$12 million per month to US$4-5 million. Management has refocused its attention on the company’s top 30-50 customers, who make up about 90% of potential unit installations.

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