(Reuters) - Sequoia Capital-backed Vector Launch Inc filed for bankruptcy on Friday and said in court filings that Lockheed Martin Corp LMT.N plans to purchase its satellite technology assets and give it a $2.5 million loan so it can continue to operate.
In the filings in a Delaware court, Vector said the U.S. aerospace and defense company plans to buy its GalacticSky-related assets, used for the development of tiny, high-tech satellites, for $4.25 million.
Lockheed’s initial offer will serve as the floor for higher bids in a bankruptcy court auction, according to the filings. A U.S. bankruptcy court judge would have to approve any sale.
Representatives for Vector and Lockheed did not immediately respond to requests for comment.
Vector said in one of the filings that it was Sequoia’s “abrupt and unexplained withdrawal of support” earlier this year that made it impossible to raise new capital that would have allowed it to stave off bankruptcy.
A Sequoia spokesperson responded by saying Vector had “failed to meet strategic objectives and financial projections” that it had outlined.
“We ultimately made the decision to part ways with the company based on its inability to achieve its proposed plans,” the spokesperson said in an emailed statement.
Launched in 2016, Vector raised more than $100 million in venture capital, including from Lightspeed Venture Partners and Morgan Stanley Alternative Investment Partners. It also won a U.S. Air Force contract for small satellite launches and conducted a series of rocket engine tests with the U.S. Defense Advanced Research Projects Agency, or DARPA.
As of August 2019, Vector employed 150 rocket scientists, engineers and other staff. It had to lay off most of them following Sequoia’s change of course, according to the filings.
Reporting by Echo Wang and Lawrence Delevingne; Additional reporting by Jessica DiNapoli and Mike Stone; Editing by Greg Roumeliotis and Sonya Hepinstall
Our Standards: The Thomson Reuters Trust Principles.