Shares of Comsat Corp. dropped to the lowest level of the year last week after regulatory hang-ups threatened Comsat's takeover by Lockheed Martin Corp.
The Federal Communications Commission is scheduled to vote this week on whether to allow Lockheed to buy up to 49 percent of Comsat, which is the U.S. partner in Intelsat, a worldwide consortium.
To protect Comsat's multinational role, company ownership is restricted by FCC rules and federal law, both of which would have to be changed to allow the takeover.
Further complicating the transaction is the Justice Department, which has demanded that before buying Comsat, Lockheed must sell its stake in Loral Space & Communications Ltd., which also is in the satellite communications business.
Divesting the Loral stock and getting Congress to change the law will take time, but Lockheed wants to get the FCC issue settled before Saturday, when its preliminary agreement to buy Comsat expires. The two companies can extend the agreement, but want to clear at least one of the regulatory hurdles by then.
Uncertainty about the merger knocked almost $7 off Comsat's stock last week, leaving it at $27.37 1/2, or about $9 from the 52-week high it hit three weeks ago when the deal looked more certain.
Except for a few companies such as Comsat that made significant news during the week, stocks of companies in the Washington region continued to laze in the doldrums where they've been since late July. The Washington Post-Bloomberg regional stock index fell a little more than a quarter of a percentage point during the week and now is down 1 percent over the past six weeks.
The week's hottest stock was V-One Corp., the Germantown maker of computer security software, which released a new version of its product that works with the trendy Linux operating system. Driven by Internet day traders, V-one stock more than doubled to $5.87 1/2 a share Tuesday. Even after giving back much of the gains, the shares remained up more than $1.50 for the week.
The newfound investor enthusiasm helped V-One complete an $8.8 million private placement of stock Friday.