Alliant Techsystems Inc. directors gave the go-ahead for the merger with Virginia-based Orbital Sciences Corp. despite last month's explosion of an unmanned rocket built by Orbital.

The Antares rocket was scheduled to deliver supplies to the International Space Station, but exploded on liftoff on Oct. 28. The disaster had caused Alliant officials to say they would review whether or not to proceed with a merger that was announced back in April.

Monday night, Alliant issued a statement saying that the merger will proceed as planned and is expected to close in February pending shareholder and regulatory approvals. Shareholder meetings to vote on the merger were delayed to Jan. 27 from Dec. 9.

Alliant Chief Executive Mark DeYoung said in a statement that continuing the merger with Orbital Sciences makes long-term sense for the company, employees and shareholders.

"During the course of the last two weeks, both companies have diligently evaluated and analyzed information relating to the Antares incident and Orbital's go-forward plan," DeYoung said. "As a result of our findings, management and our board of directors continue to endorse the previously announced transaction."

Orbital Chief Executive David Thompson said in a statement that Orbital will upgrade the propulsion system of its Antares rocket, a move that is not expected to cause ­material charges in 2015. The cause of the recent explosion is still under investigation. Losses are expected to be covered by insurance.

This image provided by NASA shows the Orbital Sciences Corporation Antares rocket, with the Cygnus spacecraft onboard suffers a catastrophic anomaly moments after launch from the Mid-Atlantic Regional Spaceport Pad 0A, Tuesday, Oct. 28, 2014, at NASA’s Wallops Flight Facility in Virginia. The Cygnus spacecraft was filled with about 5,000 pounds of supplies slated for the International Space Station, including science experiments, experiment hardware, spare parts, and crew provisions. (AP Photo/NASA, Joel Kowsky)

Alliant, which was based in Eden Prairie until 2011 and still has 200 workers there, intends to spin off its $1.6 billion sporting ammunition business to existing shareholders while separately merging its defense, satellite and aerospace business with Orbital.

Now based in Arlington, Va., ­Alliant first announced its plan to merge with Orbital in April. After the accident, doubts emerged about the merger. Alliant's stock dropped from $129.77 on Oct. 28 to $110 two days later.

As investors learned Tuesday the merger is still in the works, they sent Alliant's stock up 2 percent and Orbital's up 3.4 percent.

If the merger is approved by shareholders as expected, ­Alliant shareholders will own 53.8 percent of the merged entity that will be called Orbital ATK.

The combined firm that results from the all-stock deal will have $4.5 billion in annual revenue and take on $1.7 billion of existing Alliant debt. The company expects $70 million to $100 million in cost-reduction synergies by 2016.

Management spots

While Alliant is contributing more than $3.2 billion to Orbital ATK's estimated $4.5 billion in revenue, it appears that Orbital's management may still take two of the top leadership posts of the new entity that will have 13,000 workers and key locations in 17 states, including operations in Minnesota, Virginia, Maryland, West Virginia, ­Missouri, California, Arizona and Utah.

It did not appear that the accidental rocket explosion immediately altered post-merger management plans.

The companies previously announced that Orbital's Thompson will be the CEO of the new entity. Orbital Chief Financial Officer Garrett Pierce will take the same post in the new entity. Blake Larson, a senior vice president at Alliant, will become chief operating officer. Alliant's DeYoung will become chairman and chief executive of the stand-alone sporting entity.

Dee DePass • 612-673-7725