Saying it wants to return to focus on its core business, and citing downturn in the sector, Lockheed Martin announced Friday that it is quitting the telecom services business.
Saying it wants to return to focus on its core business, Lockheed Martin is exiting the telecom services business.
The aerospace giant announced Friday that it plans to begin selling off assets and reassigning employees of its Lockheed Martin Global Telecommunications (LMGT) services unit.
"In view of continuing overcapacity in the telecommunications industry worldwide, and deteriorating business and economic conditions in Latin America, we no longer anticipate that the LMGT businesses as a whole will be able to generate sufficient returns to justify continued investment. As a result, we are reducing our exposure to this market," said Vance Coffman, chairman and chief executive officer of Lockheed Martin.
Approximately 650 positions in the telecom services unit will be eliminated. These employees will have the opportunity to apply for job openings with other Lockheed Martin operating companies.
LMGTs Systems & Technology line of business and its COMSAT General telecommunications unit will be realigned with Lockheed Martins Space Systems business area. LMGTs Enterprise Solutions-U.S. commercial information technology business will be realigned with the Technology Services business area.
Other LMGT businesses will be evaluated for divestiture, and LMGTs equity investments will be liquidated. Candidates for divestiture include the Satellite Services division (COMSAT Mobile Communications, World Systems and Lockheed Martin Intersputnik); and Enterprise Solutions-International, which provides telecommunications network services primarily in Latin America.
Lockheed Martin previously announced an agreement to sell its COMSAT Mobile Communications operations, which provides global service via the Inmarsat system, to Telenor of Norway for $116.5 million.