Aerospace companies Orbital Sciences Corporation, one of two private companies that have sent a spacecraft on the International Space Station, and Alliant Techsystems Inc., better known as ATK, announced they have reached an agreement for their merger. This operation will be preceded by an internal reorganization of ATK, which will be split to create a new company from ATK Sporting Group, the division that produces sport weapons. The other two divisions, ATK Aerospace Group and ATK Defense Group, together with Orbital Sciences will form Orbital ATK.

With the merger between the two companies, ATK shareholders will own approximately 53.8% of the new company while those of Orbital Sciences will own approximately 46.2% of it. David W. Thompson, Orbital’s Chairman and CEO, will retain his positions in Orbital ATK. Blake E. Larson, president of ATK Aerospace Group, will be the Chief Operating Officer of the new company.

Orbital Sciences and ATK are two companies that have worked for many years in the aerospace field and also have military contracts. Their skills are similar and in many ways complementary, so much that in course of time have also done business together. Their merger is a synergy which can create a new very strong company.

Orbital Sciences’s main activity of is the production and launch of satellites. In recent years, it expanded its business with the development of the Antares rocket and the Cygnus spacecraft, earning a Commercial Orbital Transportation Services (COTS) contract with NASA for the transport of supplies to the International Space Station.

ATK, founded in 1990 as an Honeywell spin-off, manufactures various components for aerospace systems with its ATK Aerospace Group and various weapons and ammunition with the ATK Defense Group. It supplies various companies with many products ranging from satellite components to rocket engines. A couple of weeks ago, ATK announced that it signed a contract with the United Launch Alliance to provide assorted hardware for the Atlas V and Delta IV rockets.

The Orbital Sciences Antares rocket using many parts built by ATK so the merger between the two companies becomes an advantage in its management. A problem that has arisen recently is the use of Russian engines for the first stage of the rocket. The crisis exploded between the USA and Russia because of the tensions generated in Ukraine could make it much harder to use Russian hardware. If Orbital ATK could to assemble a new version of the Antares rocket using only its own engines it could continue its mission for NASA with no problems.

In 2013, Orbital Sciences and ATK generated a combined revenue for a total of $4.5 billion. Orbital ATK has every chance of being a very important company in the aerospace industry with the opportunity to invest in innovation, a key factor in a field where there aren’t many competitors but they make steady progress.

[ad name=”AmazonElectronics468″]