Maxar Gets $70 Million By Selling A Part Of SSL's Facility

Maxar Gets $70 Million By Selling A Part Of SSL’s Facility

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It has been announced by Maxar Technologies that they have sold a facility of Space Systems Loral for $70 million. Space Systems Loral is a satellite manufacturing firm and the facility was located in Silicon Valley.

This deal involved 4.5 acres of land, which represents close to 14% of total land owned by Maxar in California’s Palo Alto. The company also stated that it possesses another 24 acres of land in Palo Alto, housing its manufacturing, research and office facilities. The total property in the area is valued at $150 million to $200 million. Also, due to this deal, almost 400 of design and production engineers working on satellites will move to a facility located close by.

The CFO of Maxar, Biggs Porter, stated that the income arising from this deal will be employed to reduce the debt borne by Maxar. The company has also ensured that the movement of employees caused due to this deal wouldn’t affect customer engagement or production function.

The CEO of Maxar, Hoard Lance, stated that the divestiture of its geostationary satellite manufacturing division would assist the company in keeping under check its debt, which is of the order of $3 billion.

An analyst at BMO Capital Markets, Thanos Moschopoulos, stated that the price that Maxar achieved per acre of $15.5 million is way higher than anticipated. He also added that this partial sale indicated a valuation of $386 million for rest of the land, taking into account relevant factors. Thanos mentioned that the remaining land will need environmental solutions, which is not the case with Building 1.Due to this reason, the prospective purchaser will have to face some delay in redeveloping the land.

Thanos added that BMO Capital Markets is anticipating Maxar to declare their plan regarding divesting from geostationary satellites manufacturing business.