Reports: Purchase of Orbital ATK by Northrop Grumman could be imminent

Image Credit: Northrop Grumman / Orbital ATK

Reports appearing on Reuters, Bloomberg, The Wall Street Journal, and elsewhere are noting that Dulles, Virginia-based Orbital ATK could be purchased by defense contractor Northrop Grumman – soon. How soon? The buyout could take place as early as Monday, September 18. If this takes place, it would be just the latest merger stretching back to the earliest days of the Space Age.

Estimates place the value of Orbital ATK, itself a merger between Orbital Sciences Corp. and ATK (that merger was officially finalized on February 9, 2015) at between approximately $7.5 billion and $7.7 billion. By comparison, Northrop Grumman is thought to be worth about $47 billion.

As was noted on Bloomberg.com, Northrop Grumman, itself known for its defense and aerospace products, would be able to offer Orbital ATK’s broad range of solid rocket-fueled systems, spacecraft, munitions, and more to potential customers.

With newer aerospace firms such as SpaceX developing systems at a far lower cost than their competitors, mergers such as this one can help to strengthen companies and diversify their portfolios.

In terms of Orbital ATK, the company offers a wide selection of both launch vehicles as well as spacecraft. Some of these include the Antares Medium-class rocket, the Minotaur family of boosters, as well as the air-launched Pegasus rocket. Orbital ATK and has also produced a wide array of spacecraft which includes their Cygnus cargo freighter, NASA’s Dawn, ICESat-2, and Joint Polar Satellite System-2 vehicles.

On top of that, Orbital ATK is perhaps best known for its numerous solid rocket boosters. The company is at present developing both the advanced five-segment solid rocket boosters that will be used on the first few flights of NASA’s new super-heavy-lift Space Launch System as well as the Launch Abort Motor that is the primary motor for the Launch Abort System that Lockheed Martin’s Orion would use on crewed flights beyond low-Earth orbit.

The company also produces composite components for Colorado-based United Launch Alliance’s Atlas V and Delta IV families of launch vehicles. These are produced at Orbital ATK’s Iuka facility located in Mississippi.

However, the merger might have a more practical purpose. With Islamic extremism on the rise and increased belligerence from North Korea – in the form of missiles fired over Japan (as was noted by Reuters) – the merging with Orbital ATK’s defense and military products, as well as its extensive experience with intercontinental ballistic missiles (ICBM), would be able to provide Northrop Grumman with a more diverse array of offerings to the U.S. Department of Defense.

Moreover, Northrop Grumman was awarded a contract estimated at around $328 million to continue developing a successor to the Minuteman III ICBM. With Orbital ATK’s experience with ICBMs, this merger could serve as a “doubling down” on expertise.

As noted, these mergers are fairly common. Northrop Grumman was formed in 1994 when Northrop Aircraft purchased Grumman Aerospace. Another example is Lockheed Martin which was formed on March 15, 1995, when Lockheed Corporation and Martin Marietta signed off on the $10 billion merger.

Tagged: Northrop Grumman Orbital ATK

Jason Rhian

Jason Rhian spent several years honing his skills with internships at NASA, the National Space Society and other organizations. He has provided content for outlets such as: Aviation Week & Space Technology, Space.com, The Mars Society and Universe Today.