NEW YORK, March 20, 1998 -- Loral Space & Communications announced today that it has completed the acquisition of Orion Network Systems, Inc., through an exchange of Loral common stock. In a transaction valued at approximately $479 million, Orion shareholders received 0.71553 shares of Loral common stock in exchange for each Orion share, or approximately 18.3 million newly issued shares of Loral in the aggregate.

"We are pleased to welcome Orion's employees and its customers to the Loral Space & Communications family," stated Loral chairman and chief executive officer, Bernard L. Schwartz. "The addition of Orion's assets to Loral's portfolio furthers Loral's building block strategy, expands its value-added satellite services offerings and extends its reach into high-growth international markets."

Loral Orion, based in Rockville, Md., is an international satellite communications company that provides high-speed Internet connections for corporations and Internet Service Providers (ISPs) and private, multimedia network communications services directly to multinational businesses via small receiving antennas. It also transmits video communications for television and other program distribution services.

Loral Orion owns and operates the Orion 1 satellite, placed in service in January 1995, covering the European, transatlantic and U.S. markets, and has two additional satellites under construction, the cost of which was substantially funded through the public issuance of debt in 1997. Orion's transponder capacity will increase substantially with the launching of Orion 3, scheduled for service in January 1999, covering the Asia Pacific region, and Orion 2, which will serve the Americas and Europe beginning in June 1999. The three-satellite constellation will be capable of providing services to over 85% of the world's population by 1999. In addition, Orion has authorization for valuable domestic and international orbital slots, including certain slots for the provision of Ka-band service.

Loral Orion serves a customer base of 300 multinational businesses and Internet service providers in 50 countries via approximately 680 installed terminals (earth stations or very small aperture terminals [VSATs]) that receive networked value-added services from Orion 1. The company also operates a tracking, telemetry and control (TT&C) facility in Mount Jackson, Virginia.

Loral Space & Communications Ltd. concentrates on satellite manufacturing and satellite-based services. Space Systems/Loral is a leading manufacturer of commercial communications and weather satellites. Loral Skynet is a leading U.S. satellite communications service provider that owns and operates the Telstar satellites. Loral, along with a Mexican partner, owns a 75 percent equity interest in Satelites Mexicanos, S.A. de C.V., the Mexican national satellite system. In addition, Loral manages and holds a 39 percent equity interest in Globalstar, the global, mobile satellite-based telephony system scheduled for service initiation in 1999. Loral also is the developer of CyberStar, a geostationary satellite-based, open protocol, digital telecommunications system that will offer a variety of low-cost, high-speed, data and telecommunications services worldwide, initially from leased Ku-band transponders in 1998 and subsequently through a dedicated constellation of geosynchronous Ka-band satellites.

Contact: Jeanette Clonan