Lockheed Martin on S&PWatch Neg;Northrop GrummanWatch Pos.

NEW YORK--(BUSINESS WIRE)--Standard & Poor's CreditWire 7/3/97-- Standard & Poor's today has placed Lockheed Martin Corp.'s long-term ratings on CreditWatch with negative implications and Northrop Grumman Corp.'s ratings on CreditWatch with positive implications (see list below). Lockheed Martin's

Assuming regulatory approval of this transaction, the combined entities would have by far the strongest competitive position in the defense industry. However, both companies have strained financial structures, the legacies of recent major debt-financed acquisitions. Current credit protection measures, while improving, are subpar. This merger compounds the uncertainties regarding the pace of financial recovery that is factored into current ratings. Combination with Northrop Grumman and attendant uncertainty regarding cash outlays for integration initiatives could delay debt reduction. Northrop Grumman's listing reflects its merger with a more creditworthy partner; moreover, Lockheed Martin has indicated that it would guarantee Northrop Grumman's debt. -- CreditWire

-0-

RATINGS LISTED ON CREDITWATCH WITH NEGATIVE IMPLICATIONS
Lockheed Martin Corp.
  Corp credit rtg                                 BBB+
  Sr debt                                         BBB+
Lockheed Corp.
  Corp credit rtg                                 BBB+
  Sr debt                                         BBB+
Martin Marietta Technologies Inc.
  Corp credit rtg                                 BBB+
  Sr debt (gtd: Lockheed Martin Corp.)            BBB+
Loral Corp.
  Sr unsecd debt (gtd: Lockheed Martin Corp.)     BBB+
TOTAL DEBT: about $11.2 bil

RATINGS ON CREDITWATCH WITH POSITIVE IMPLICATIONS
Northrop Grumman Corp.
  Corp credit rtg                                 BBB-
  Sr debt                                         BBB-
  Rule 415 shelf sr/sub debt (prelim)             BBB-/BB+
Northrop Corp.
  Corp credit rtg                                 BBB-
  Sr debt                                         BBB-
TOTAL DEBT: about $3.4 bil

RATINGS AFFIRMED; NOT ON CREDITWATCH
Lockheed Martin Corp.
  3(a)3 CP prog                              A-2
  4(2) CP prog                               A-2

CONTACT: Martin Knoblowitz, New York (1) 212-208-1614