Sea Launch's plans to emerge from bankruptcy under majority Russian ownership are still subject to court and regulatory approval, but company leaders say they expect to resume commercial missions early next year.

File photo of a previous Sea Launch liftoff. Credit: Sea Launch

The besieged launch firm filed a plan of reorganization in a Delaware bankruptcy court this week, kicking off several months of behind-the-scenes negotiations between the Sea Launch's new owners and unsecured creditors.

"It's been a tough road to get where we are today, but we're very pleased that we now have a strategic investor that will continue the business we've developed over the last 10 years," said Kjell Karlsen, president and general manager of Sea Launch.

Energia Overseas Ltd., a subsidiary of the Russian aerospace giant Energia, plans to purchase 85 percent of the stock in Sea Launch for $140 million in cash. The unsecured creditors, or firms that acquired a stake in Sea Launch in exchange for owed debts, will collectively hold 15 percent ownership in the reorganized launch business.

"We don't any additional [financing]," Karlsen said. "It would have been great to have more, but this will take us through this reorganization."

A confirmation hearing in late July will sort out objections between the creditors and Energia Overseas, Karlsen said.

"At the same time, we also have to get regulatory approvals," Karlsen said. "We anticipate that will take a little longer than the 60 days to the end of July, so the date of [emergence] will be when we receive all of those approvals, which we anticipate to take place in the August or September timeframe."

In the meantime, Sea Launch is working closely with existing and would-be customers to add more missions to its manifest, which was nearly emptied after satellite operators moved their payloads to other rockets last year.

"We have been working with some of our strongest supporters for some period of time now to shore up our backlog. We anticipate by the time we have our confirmation hearing that we will have some positive announcement in that regard," Karlsen said.

The court is not expected to stipulate Sea Launch build a larger manifest of future missions before approving its emergence from bankruptcy.

In addition to its stock purchase, Energia Overseas is providing $200 million in working capital for Sea Launch.

Sea Launch plans to use the working capital to ensure on-time payments to suppliers. Boeing Co. builds the payload fairing for Sea Launch's Zenit 3SL rocket, Energia provides the Block DM upper stage, while Yuzhnoye and Yuzhmash of Ukraine are in charge of the Zenit's first and second stages.

Late payments to Ukrainian suppliers caused delivery delays for crucial launch hardware, postponing flights of commercial communications satellites in the months prior to Sea Launch's filing for Chapter 11 bankruptcy protection in June 2009.

"The biggest change is Energia now has a prime contractor role," Karlsen said. "They will be responsible for all hardware from Russia and Ukraine."

The working capital from Energia Overseas will also go toward payments to suppliers.

"The second biggest change will be our access to the working capital facility, which will allow a steady stream of payments to our suppliers, especially in Russia and Ukraine, which will ensure hardware is produced on time."

If Sea Launch can clear court and regulatory hurdles by the end of the year, commercial launches could resume in early 2011.

Sea Launch's land-based subsidiary, called Land Launch, will blast off with the Intelsat 18 spacecraft in the first quarter of 2011. Another Zenit rocket will lift off from the mobile Odyssey launch platform next summer with a satellite for either Intelsat or Eutelsat.

The Odyssey vessel, along with a command ship, sail from Sea Launch's home port in Long Beach, Calif., to a site in the middle of the Pacific Ocean along the equator at 154 degrees west longitude. Zenit rockets managed by Sea Launch have flown 30 times from the Pacific location, and Land Launch has accomplished four missions.

Earlier talk of moving ocean-based launches closer to the California coast has been put on hold, Karlsen said.

"We had to do significant environmental studies and other studies to satisfy some of the requirements the FAA and other licensing organizations had," Karlsen said. "I think it would be very tough to change that. You never say never, but I don't see that in the immediate future."