Sea Launch files for Chapter 11 protection

[Cbased]

http://en.rian.ru/russia/20091110/156780654.html

BAIKONUR, November 10 (RIA Novosti) - RSC-Energia, a leading Russian spacecraft maker, is putting a strong effort to revive its bankrupt Sea Launch joint international project, the head of the company said on Tuesday.

The Sea Launch consortium, established in 1995, is owned by Boeing, RSC-Energia, Norway's Kvaerner ASA, Ukraine's Yuzhnoye design bureau and Yuzhmash production association. It is the only company that conducts launches from a sea-based platform near the Equator, which allows rockets to carry heavier payloads than from other latitudes.

"Boeing has paid off its Sea Launch debts and filed claims to other partners...We are taking steps to save the project so that Boeing receives dividends from it rather than putting claims against us," Vitaly Lopota said.

"We have solid prospects and have found investors," he added.

In June 2009, the provider of the Sea Launch service, California-based Sea Launch Co. LLC, filed for Chapter 11 bankruptcy protection in a U.S. court.

Sea Launch told the court that its assets were valued between $100 million and $500 million, but that its liabilities are between $500 million and $1 billion. The company hired Alston & Bird LLP to handle the restructuring.

While the company continues work on reorganization, preparations are underway for the launch of the Intelsat 15 communications satellite later this year, from its Land Launch site at the Baikonur Space Center in Kazakhstan.

Sea Launch has carried out 30 rocket launches from the Odyssey launch platform in the Pacific Ocean since 1999.

[Smoothie]

http://www.spacenews.com/launch/091111-bankrupt-sea-launch-gets-new-financing.html

Bankrupt Sea Launch Gets New Financing

PARIS — Unidentified investors operating under the name Space Launch Services LLC have agreed to provide initial financing to Sea Launch Co., the commercial launch provider that is in Chapter 11 bankruptcy proceedings, according to bankruptcy court records and Sea Launch President Kjell Karlsen.

Karlsen said in a Nov. 11 interview that the backers are strategic, not financial, and ultimately want to manage Sea Launch through bankruptcy and a return to commercial activity. He specifically said they were not private-equity investors but companies with a long-term interest in the space industry.

“These are people who are interested in access to space,” Karlsen said. “They believe Sea Launch will give them that. They are people who have worked in the past with one of our partners and whom we know.”

Karlsen said Space Launch Services has agreed to provide $5 million immediately and another $7.5 million in early December at a hearing scheduled by the Delaware Bankruptcy Court overseeing Long Beach, Calif.-based Sea Launch’s reorganization.

Karlsen said the $12.5 million should be enough to carry Sea Launch through February. He said he still expects Sea Launch to emerge from Chapter 11 bankruptcy in the spring.

The world’s three largest commercial satellite fleet operators — Intelsat of Bermuda and Washington; SES of Luxembourg; and Eutelsat of Paris — all submitted statements to the court on behalf of Sea Launch, Karlsen said. In addition to wanting access to a broader supply of commercial rockets, all three of these companies are among Sea Launch’s unsecured creditors because of launch contracts that are now at risk in the Chapter 11 proceeding.

Sea Launch lofts commercial telecommunications satellites from a converted Norwegian floating oil platform using the Russian- and Ukrainian-built Zenit 3 rocket. Sea Launch, whose founding investors include Chicago-based Boeing Co., entered bankruptcy in June.

Karlsen said Space Launch Services is one of three investor groups that had offered to provide what is known in bankruptcy proceedings as debtor-in-possession (DIP) financing. DIP finance providers generally position themselves to take an ownership stake in the bankrupt company, and Karlsen said that is the case for Sea Launch.

With the Nov. 10 approval of the bankruptcy court, Sea Launch accepted Space Launch Services’ offer above the other two because it carried far more favorable interest and payment terms, Karlsen said.

[edkyle99]

So Sea Launch is being restructured with money from new investors.  I wonder who will own what when it is all said and done.  Will Boeing, for example, own a substantially smaller share, or any share for that matter, of the new Sea Launch?

 - Ed Kyle

[McDew]

So Sea Launch is being restructured with money from new investors.

No, not yet

From the court motions; This DIP financing is an emergency 6 month loan pledging the Marine assets (ship and LP) as collateral otherwise they were out of money.  This keeps the lights on at Sea Launch until February at which time they will need to have a viable reorganization plan (with new investors) or likely get forced into Chapter 7.

The interesting twist is that SLS is mainly the same group of guys from Excalibur (not sure who is fronting the $12.5M in cash).  Their stated strategic interest is obtaining the use of the ship and LP as a launch platform for their other activities.  Remember all that old Almaz stuff!!!  They're back...

[kq6ea]

It will be very interesting to see how this all plays out.

[Danderman]

For what its worth, the Delaware Secretary of State's office reports that Space Launch Services LLC was formed last week.

[Antares]

Here's your answer, Ed.

Boeing expected to end stake in rocket firm Sea Launch
http://www.latimes.com/business/la-fi-sealaunch12-2009nov12,0,4439205.story

[sammie]

Well, I was sort of thinking ahead and wondering about how this all is going to play out. Sea Launch/Land Launch only got two more firm launches in their manifest, a SL for 2010 and a LL for 2011. There is another non SL Zenit slated for launch next year with a Fregat upper stage.

But I assume that production of the Zenit's first two stages in the Ukraine had pretty much proceeded as normal up until the bankruptcy. So there is going to be lot of half finished hardware around.

In an interview from on the other side SL states they can be profitable with 4 launches a year. Which is what they were doing in the first place, so I wonder where they are cutting costs as per previous operations.

Also both Arianespace and ILS say that they are booked up for 2010 and only one or two space for 2011. I wonder whether a restructured SL/LL could offer spaces in 2010 for the heavy class satellites, and how much time they would need to prepare hardware. 

ah well, hopefully we will see Zenit launch in one way or another for a long time...

[pippin]

ah well, hopefully we will see Zenit launch in one way or another for a long time...

Yes. It's one fine launcher.
Kind of where SpaceX eventually wants to be...

[McDew]

SL continues to have problems lining up a long term invester to back the program with a viable business plan.  SL filed a motion today with the bankruptcy court to extend the deadline for a reorganization plan by another 90 days.  New proposed deadline is now 17 June 2010.

[Smoothie]

SL continues to have problems lining up a long term invester to back the program with a viable business plan.  SL filed a motion today with the bankruptcy court to extend the deadline for a reorganization plan by another 90 days.  New proposed deadline is now 17 June 2010.

Where did you get this information?  A search turns up nothing.  Can you please post a link?

[McDew]

SL continues to have problems lining up a long term invester to back the program with a viable business plan.  SL filed a motion today with the bankruptcy court to extend the deadline for a reorganization plan by another 90 days.  New proposed deadline is now 17 June 2010.

Where did you get this information?  A search turns up nothing.  Can you please post a link?

https://ecf.deb.uscourts.gov/
This is the link to the U.S. Bankruptcy Court for the District of Delaware.  To use the link to access the document filing system you have to register for the PACER service and pay for any documents downloaded.

[clsspace]

I checked out the ExcaliburAlmaz website, I didn't know Bo Bejmuk was one of the consultants.  Very Interesting.
http://excaliburalmaz.com/SP1/company-leadership.php

So Sea Launch is being restructured with money from new investors.

No, not yet

From the court motions; This DIP financing is an emergency 6 month loan pledging the Marine assets (ship and LP) as collateral otherwise they were out of money.  This keeps the lights on at Sea Launch until February at which time they will need to have a viable reorganization plan (with new investors) or likely get forced into Chapter 7.

The interesting twist is that SLS is mainly the same group of guys from Excalibur (not sure who is fronting the $12.5M in cash).  Their stated strategic interest is obtaining the use of the ship and LP as a launch platform for their other activities.  Remember all that old Almaz stuff!!!  They're back...

[ddford]

Boeing wants who out of where? That doesn't make sense to me.

[clsspace]

http://www.kyivpost.com/news/business/bus_general/detail/60610/

http://www.satellitetoday.com/st/headlines/Sea-Launch-Receives-Second-Loan-from-Space-Launch-Services_33480.html

http://www.satnews.com/cgi-bin/story.cgi?number=286980293

[clsspace]

Interesting developments, possible move of launch site and payloads.

http://www.spacenews.com/launch/100312-sea-launch-preparing-bankruptcy-exit.html

[sammie]

I guess the man-rating of Zenit is being done for the Excalibur Almaz crowd. Would be interesting to see, but launching from the ocean would make an abort recovery of the manned capsule rather hard.

And I don't really see the advantage of a new launch site, there is just a very very small chance that just moving to territorial waters will make the Zenit-3SL, an Ukrainian/Russian combi, qualify as a U.S. launch system. Imagine the cry from Congress if the Zenit is chosen over Delta 4/Atlas 5 and Falcon 9. The statement also doesn't fly with earlier statements about profitability and a reduced launch rate. Sea Launch claimed they could turn a profit with 4 launches a year. In the past the long transit times may have been a bottle-neck for more launches per year. But so was the sluggish ramp up of production in the Ukraine and the fact thatr ocean transfer of Zenit rockets didn't work out as planned. But I doubt that a very launch rate can ever be sustained by the current market, 4 to 6 launches to the GTO market is the best they could hope for.

[sammie]

From Aviation Week

First part is about ILS bidding for a Galileo launch contract. Second part is about ILS with some information on how they want to operate without Boeing and Aker.

By June, he expects to finish all other recovery tasks necessary to resume flights: completing due diligence; finding a new investor to replace Boeing and Aker Solutions; transferring licenses from Boeing to the new owner; and making Energia the Sea Launch prime contractor, with responsibility for all suppliers. Karlsen says he has initialized—but not yet signed—a term sheet with a new investor. Candidates include Space Launch Services, which participated in the DIP financing, and an unnamed company.

[edkyle99]

'Gotta wonder how Boeing can lose $750 million on Sea Launch while the other original investors seem good to go.

Beware, Orbital.

 - Ed Kyle

[Jim]

'Gotta wonder how Boeing can lose $750 million on Sea Launch while the other original investors seem good to go.

Beware, Orbital.

There are no parallels between Boeing - Sealaunch and OSC - Taurus II