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Loral Corporation

From Alfawiki
Loral Corporation
Company typePublic (until 1996)
IndustryAerospace, Defense, Electronics
Founded1948; 78 years ago (1948) in New York City, United States
FounderWilliam Lorenz, Leon Alpert
Defunct1996 (1996)
FateDefense electronics and system integration units sold to Lockheed Martin; remaining businesses renamed Loral Space & Communications
SuccessorLoral Space & Communications, Lockheed Martin (for defense units)
Headquarters
Bronx, New York City
,
United States
Area served
Worldwide
Key people
Bernard L. Schwartz (CEO from 1972)
ProductsRadar, sonar, communications, telemetry, satellite navigation systems

Loral Corporation was established in 1948 in New York City by William Lorenz and Leon Alpert under the name Loral Electronics Corporation, a title derived from a combination of the founders’ last names.

History

Initially, Loral focused on creating radar and sonar technologies for the United States Navy. The company went public in 1959, issuing 250,000 shares at $12 each, with the capital raised invested in constructing a new headquarters on a 10-acre property located in the Bronx. That same year marked the beginning of Loral’s diversification strategy through the acquisition of smaller firms including Willor Manufacturing Corp., American Beryllium Co., Arco Electronics, along with several plastics companies, which collectively helped the company secure additional military contracts.

By 1961, Loral had launched a division dedicated to communications, telemetry, and satellite navigation systems. This expansion required financial backing, leading to a $15 million loan secured from Massachusetts Mutual Life Insurance Company in 1965.

Throughout the late 1960s, Loral won several significant defense contracts: $3.9 million from the U.S. Navy for Doppler navigation radar in 1965; $14 million awarded by General Dynamics for electronics integration on the F-111 aircraft in 1969; and another $3.9 million for airborne countermeasures installed on the Phantom RF-4C reconnaissance aircraft. The company’s expertise was particularly noted in radar receivers capable of detecting enemy radar signals.

However, by 1971, many of these acquisitions proved unprofitable and fell outside Loral’s primary areas of expertise, resulting in financial difficulties including losses totaling $3 million and challenges meeting loan obligations. This situation prompted the founders to contemplate selling half of their ownership stake.

In 1972, as the company approached bankruptcy, Bernard L. Schwartz purchased a 12% interest and assumed the role of CEO. Over the next twenty years, Schwartz led Loral through an aggressive acquisition strategy comprising sixteen companies, transforming it into a leading global aerospace and defense enterprise. By 1995, annual revenues had grown to $5.5 billion. The following year, Loral divested its defense electronics and system integration divisions to Lockheed Martin, while its remaining businesses were rebranded as Loral Space & Communications. Subsequently, in 1997, several former Loral units that had become part of Lockheed Martin were spun off to form the foundation of L-3 Communications.

In 1996, Loral became embroiled in allegations concerning unauthorized technology transfers to China after an investigation into a launch failure involving an Intelsat 708 satellite manufactured by Space Systems/Loral. In 2002, Loral resolved these allegations by agreeing to pay $20 million in fines to federal authorities and committing to enhanced compliance measures. Although executives did not admit guilt, they recognized the gravity of the situation and sought to rectify it through restitution efforts. Bernard Schwartz accepted full accountability for the incident, attributing it to an employee oversight.

Timeline

  • 1948 – Founded as Loral Electronics Corporation
  • 1959 – Conducted initial public offering
  • 1972 – Bernard L. Schwartz acquires controlling interest amid financial crisis
  • 1987 – Acquired Goodyear Aerospace; established Loral Defense Systems
  • October 1990 – Purchased Ford Aerospace; divisions restructured into Space Systems/Loral and Loral Western Development Labs
  • 1991 – Collaborated with Qualcomm on Globalstar project; eventually held a 42% share
  • 1994 – Bought IBM’s Federal Systems Division; renamed it Loral Federal Systems
  • May 5, 1995 – Acquired Paramax (Unisys defense unit) for $862 million in cash
  • January 8, 1996 – Sold defense electronics and system integration units to Lockheed Martin for $9.1 billion; residual operations renamed Loral Space and Communications
  • October 5, 2007 – Alongside Public Pension Investment Board of Canada, completed purchase of Telesat from BCE Inc. for CAD $3.25 billion; retained a 64% ownership stake

Additional Acquisitions

  • Fairchild-Weston
  • LTV Missiles (Vought)
  • Solartron

Former Divisions

  • Loral Aeronutronic (Rancho Santa Margarita, California)
  • Loral Command Control Systems
  • Loral Conic (San Diego, California)
  • Loral Defense Systems (Akron, Ohio)
  • Loral Instrumentation (San Diego)
  • Loral/Liris
  • Loral ROLM Mil-Spec Computer Systems (San Jose, California)
  • Loral Space Information Systems
  • Loral Space & Range Systems (Sunnyvale, California)
  • Loral Terracom (San Diego)
  • Loral Vought Systems (Grand Prairie, Texas; currently integrated into Lockheed Martin Missiles and Fire Control)
  • Loral Narda
  • Loral Randtron
  • Loral Western Development Laboratories
  • Loral Infrared & Imaging Systems, LIRIS (Lexington, Massachusetts)
  • Loral Electro Optical Systems, LEOS (Pasadena, California)

External links

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