The company, which includes trailer-tracking unit Vantage Tracking, has announced layoffs of some 100 employees, the second round of staff cuts in less than a month. Last week, Orbcomm said it would likely have to skip an interest payment due Aug. 15 on its senior notes. The company said it had arranged $17 million in interim debt financing.
Orbcomm is jointly owned by Teleglobe Inc. of Montreal, Canada, and Orbital Sciences Inc. of Dulles, Va. Earlier this year, Orbital Sciences reduced its equity position in Orbcomm from 50 percent to 33 percent, making Teleglobe the primary partner. Last week, Teleglobe announced it would no longer fund Orbcomm and began looking for new equity partners.
Orbcomm said in a statement that a revised business plan calls for scrapping direct sales and working through resellers. That will allow the company to focus on communication services for major customers. According to the statement, current financial difficulties will not prevent the company from maintaining and operating its constellation of 35 satellites.
For 1999, Orbcomm lost $144.5 million on revenues of $2.8 million. However, at the end of the second quarter of 2000, the company said it had 242,000 subscriber units in service or on order.