Starbridge Weekly Space Update for 2/20/2023

Portfolio News

Axiom

• NASA is providing commercial space station developers with additional information about its plans for those facilities. 

SpaceX

• SpaceX President says Starlink had a 'cash flow positive quarter' & is on track to 'make money' in 2023

• SpaceX has scuttled plans to convert oil rigs into Starship launch platforms.

• Before the two Falcon 9 launches, the FAA announced its intent to fine SpaceX for not providing data ahead of a Falcon 9 launch last year.

• Secretary of State Antony Blinken said the government has had "conversations" with SpaceX about restrictions the company has placed on the use of Starlink by Ukraine.

Umbra

Umbra announced an agreement with Maxar for direct access to their radar imaging satellites data. Above is an example of Umbra's SAR image and Maxar's optical image of the same location. You can find a more detailed overview of Umbra in one of last week's Payload updates.

General Space News

Shares in Intuitive Machines (NASDAQ: LUNR) skyrocketed to a high of $51 a share after de-SPACing last week. The company ended the week at $40.70/share but no one is quite sure what caused the jump to happen. Via Payload: 'Intuitive Machines originally anticipated that its SPAC transaction could generate $301M. However, a recent filing with the SEC revealed that SPAC shareholders opted to redeem a whopping $279.9M (or 27.5M shares) prior to the transaction, which closed on Valentine’s Day. The high redemption rate leaves Intuitive Machines with far less cash than expected.'

Maxar Technologies (see Umbra announcement above) announced the end of its “Go-Shop” period last week. Maxar discussed acquisition proposals from 36 potentially interested third parties but did not receive any that were better than Advent’s $53/share all cash offer. 

The Space Force confirmed its plans for a "dual-lane approach" to its National Security Space Launch (NSSL) procurement program that specifically enables contracts with emerging launch companies and with vehicles that may not be able to reach all NSSL-required orbits. 

The Biden administration’s Space Force budget proposal for 2024 will likely ask for an additional $3 to $6 billion dollars over the 2023 budget which could easily be $31 to $34 billion in funding for 2024. The primary motivation seems to be due to increasing awareness of 'space' threats from both Russia and China.

There is an almost daily debate in Europe concerning how its space industries and ambitions survive in a world of Starships and Starlinks.  Whether it was the tech divide during the pandemic or now with the war in Ukraine, Technological Sovereignty is once again a hot topic in European policy circles. One result is a renewed understanding that Europe’s capital structure does not support innovation but is rather focused on wealth preservation.

There have been several announcements recently of new Europe-focused ‘venture funds’ with the latest being Germany’s new deeptech and climate fund (funded by the German government's €10bn Future Fund). The issue with many of these ‘funds’ is that they focus on sovereignty far more than they focus on innovation which equals much less profitability or return on investment. If the goal is simply to maintain parity while growth and ROI are a distant “nice to have,” then how much will Europe’s tech and space sector, specifically, be distorted?

Other Space News

• An uncrewed Soyuz spacecraft is set to launch to the International Space Station later this week after a Progress cargo spacecraft that suffered a coolant leak departed.

• National Space Council (NSpC) Users' Advisory Group (UAG); Meeting

• SatSure, a Bengaluru-based, space-focused intelligence startup, raised a INR 120 crores (~$14.5M) Series A

• Two senators have reintroduced legislation to create a Space National Guard.

• For the second time in less than two months, a Russian spacecraft docked to the International Space Station suffered a coolant leak.

• Astranis won a contract to incorporate military communications on one of its small GEO satellites. 

• Aerospace and defense contractor Boecore is acquiring Orbit Logic. 

• The European Commission will conduct a full-scale investigation of Viasat's proposed acquisition of Inmarsat, which may further delay the completion of the deal. 

• The European Parliament has approved a proposed satellite connectivity constellation.

• Boeing opened this week the production facility where it will build a new Space Launch System upper stage.

• Japanese space agency JAXA aborted first launch of the new H3 rocket Thursday night just after igniting its main engine. 

• NASA and Boeing say the first crewed flight of the company's CST-100 Starliner vehicle remains scheduled for April.

• Space Station Research Announcement for Advanced Materials and Manufacturing Open Now

• European Startups Hungry for Space Tug Market Share - Payload

Starbridge Weekly Space Update for 2/13/2023

Starbridge Update

Felix Hartmann, founder of Hartmann Capital as well as one of our wonderful Starbridge fund LPs, invited Steven Jorgenson and Michael Mealling to his podcast during Starbridge's recent business trip to Miami to talk about all things space investing, what to keep an eye on, and even addressing some long-standing conspiracy theories! (Runtime: 1 hour 22 minutes)

Portfolio Company News

Axiom

Axiom confirmed that two Saudi astronauts will fly on the private Ax-2 mission to the ISS. The Saudi Space Commission announced that Rayyanah Barnawi and Ali Alqarni (center) will fly to the ISS on the Ax-2 private astronaut mission with Mariam Fardous (left) and Ali Alghamdi (right) as backups.

Lynk

Tyghe Speidel, Lynk Global's CTO, was on a panel with other 'direct to device' companies and had an interesting exchange on markets, spectrum, and strategy with some of Lynk's competitors.  Spectrum strategy divides the emerging direct-to-smartphone market

SpaceX

• Booster 7 31-Engine Static Fire Test | SpaceX Boca Chica

• Small satellite sector should prepare for Starship

• Shotwell: Ukraine “weaponized” Starlink in war against Russia - SpaceNews

Voyager

Voyager Space raises $80M as it continues development on private space station, Starlab

General Space News

Camden County spaceport dream scuttled by Georgia Supreme Court ruling

The long, tragic story of the only greenfield spaceport on the East Coast of the US is winding down and the conclusion across the industry is that, while the site has various organizational and political problems, at the end of the day it simply isn’t possible to build operational tempo, eastern facing, launch sites in the continental United States anymore. 

Blue Alchemist Technology Powers our Lunar Future

While a lot of questions remain about taking this technology operational, this is proof that you can build complex electronics using nothing but what you find on the Moon. One of the places you could build an incredibly large space-based solar power station for an incredibly low price is on the surface of the Moon. 

ISRO's second SSLV mission successfully launches trio of satellites

As we have said before, India is a growing space power and one that Starbridge is paying close attention to. 

Roscosmos’ Progress 83 cargo spacecraft sprung a leak in its coolant loop while docked to the ISS. All the coolant inside escaped into space.

This is the second time this has occurred using Russian systems. While the new leadership at Roscosmos is being significantly more forthcoming with information, there does seem to be a downward trend with quality control at Roscosmos. 

The SmallSat Symposium was last week and there several discussions about how the business of smallsats has impacted both investors and startups.

• Skeptical investors are placing new demands on space startups

• Defense giants are hungry for space companies

• Boeing and Millennium cite the benefits of partnership

As discussed in our predictions for 2023, the chess pieces for a space policy jurisdiction fight are being placed:

• House and Senate plan new NASA authorization bills

• White House reviewing input on mission authorization concepts

Other Space News

• COSMOS 2499, a Russian satellite launched in 2014, broke up into ~85 pieces at an altitude of 1,169 km.

• Exotrail raises $58M for spacestudio, spacedrop, spaceware, and spacetower

• As record rocket launches crowd airspace, the FAA fights to limit travel disruptions

• United States and India expand civil space cooperation

• Lockheed Martin, Viasat executives named to presidential advisory panel

• Alondra Nelson to leave White House science office

• NASA Awards Spacecraft Processing Operations Contracts to SpaceX and Astrotech

• Intuitive Machines moves landing site of first mission to lunar south pole

• Busek ramps up production for OneWeb constellation

• United Launch Alliance is closing a Texas facility that builds Atlas rocket components.

• NASA refining Artemis exploration architecture

• KSAT expands global ground network

• Amazon gets key FCC approval for more than 3,000 LEO broadband satellites

• Voyager Space raises $80M as it continues development on private space station, Starlab

• Space industry undeterred by congestion and debris

Starbridge Weekly Space Update for 2/6/2023

Welcome to 2023! 

Starbridge Team Update

Michael and Steven were in Miami last week at the iConnections Global Alts conference locking in Starbridge Fund III commitments.

The first month of the year is always an incredibly busy time for any finance company so we are running a bit late in our weekly space news update. So here's a recap of what's been happening in January 2023 along with Starbridge's predictions of what's to come.

As you may remember, Michael was in India a few months ago participating in the first Indo-Pacific space technology conclave hosted by IIT Madras and sponsored by the US State Department. The results of that have been published in this white paper that was recently released. Starbridge looks forward to working with commercial space companies in the various participating countries. 

Portfolio Company News

The year began with the Transporter-6 launch that included Umbra and Lynk satellites. Both companies report satellites are performing well. 

Avealto

Strong interest and public statements of support from both senior officials and regulators in Indonesia have resulted in the large island country becoming the ideal first target for the commercial roll out of Avealto’s novel high-altitude communications platform this year. “Indonesia is the 4th most populous country in the world with over 6,000 populated islands. Avealto Wireless Infrastructure technology can provide high quality and cost-effective connections to the most remote regions of Indonesia, to fully close the digital divide in that nation.” - Walt Anderson, Avealto CEO. Expect additional announcements in the coming weeks. 

In the meantime, Avealto has opened up a new funding round to support their build-out of service, so let Starbridge know if you want to take a look at this along with our deep-dive research into the company. 

 Axiom

In a recent call with reporters, Axiom CEO Mike Suffredin said “I expect that Ax-3 will be largely a country customer kind of flight with our professional astronaut,” he said, which will be repeated on Ax-4. “I think that, between those two flights, maybe one private individual will fly.” 

ISS partners have approved, but not named, the crew of AX-2 which will fly in May. While one member of the crew will be John Shoffner, the other two crew members have not been announced yet. They are widely expected to be two astronauts from Saudi Arabia but the announcement of who they are is being left to the Saudi government. 

Amir Bachman, Axiom CIO, delivered a talk about innovating in microgravity at Boryung's inaugural Care in Space Demo Day

In related good news for all of the Commercial LEO Destinations (CLD) program participants, NASA has maxed out its utilization of its share of the International Space Station given crew and cargo limitations.

Commonwealth Fusion Systems

Things seem to be progressing to plan as CFS continues to build out its SPARC demonstration facilities. We wanted to point out a recent podcast interview of MIT nuclear scientist Dennis Whyte.  Dr. Whyte has been working with CFS for years and has some great insights into both the company and the overall field of fusion energy that anyone interested in this topic should listen to.

Lynk

Lynk launched two more satellites on Transporter-6 in January and both spacecraft are in final checkout. Lynk is also finalizing the installation of a ground station in Hawaii. 

Offworld.AI

Offworld and Saudi Arabian state-owned mining company Ma’aden signed an agreement last week “to initiate the first deployment of autonomous industrial mining robots in Ma’aden’s mines”. On a possibly related note, Saudia Arabia, a recent signatory to the Artemis Accords, has withdrawn from the Moon Treaty.

Orbital Sidekick 

Orbital Sidekick Raises $10M, Preps for Launch of Hyperspectral Constellation - Payload

Space Forge

Due to Virgin Orbit’s launch failure in January, Space Forge’s ForgeStar-0 was unable to complete its in-space testing. Work is already underway on a new satellite - ForgeStar-1 - and it is 12 to 16 weeks away from being built and will launch later this year. Co-founder and CEO Josh Western said, "It's a much more capable satellite than ForgeStar-0. ForgeStar-1 is about 10 times the size, and it's both a demonstration of our re-entry technology and in-space manufacturing technology.”

SpaceX

SpaceX performed a wet dress rehearsal of the fully stacked Starship recently and is preparing for the first static fire of the Super Heavy booster. This will be the first time that all 33 sea-level optimized Raptor engines will be fired on the Super Heavy and a record for the most number of engines firing on a single rocket. The previous record holder was the Soviet N1 with 30 engines but there was never a successful launch. 

Xplore 

Xplore multi-sensor satellite to offer space data products under NOAA imagery license

General Space News

• Iridium, Qualcomm Announce Satellite-to-Snapdragon Partnership - Payload

• Exclusive: Euroconsult Values 2022 Space Economy at $464B - Payload

The doom and gloom continues while the aerospace and defense sector sees the second busiest year ever.  Space SPACs are once again in the news with the announcement of World View's SPAC offer led by Leo Holdings Corp. II in a $350M deal. The Intuitive Machines SPAC received a buy rating recently with a $14 price target. The merger is expected to close later this quarter. 

The Department of Defense threw a bit of cold water on two parts of the space sector with statements that it has no plans to return to the era of large, expensive satellites and no plans to go beyond GEO and will only support military operations on Earth. While the first statement was already well understood by the sector, the second was a blow to those who saw Space Force as a way to bootstrap cislunar transportation systems to support intelligence and reconnaissance missions. 

NASA named A.C. Charania, a long-time commercial space advocate and executive, as NASA’s new chief technologist. Charania is the former VP of product strategy at Reliable Robotics and has contributed to lunar and launch programs at Blue Origin and Virgin Orbit. This new hire is a departure by NASA from its previous strategy of two-year rotations of senior academics in aerospace engineering. Senior leadership at NASA wanted someone from the commercial sector who could educate the NASA workforce on how and why commercial companies were beginning to innovate faster than NASA could. 

Frank Lucas (R-OK-3), newly named chair of the House Science, Space, and Technology Committee, says he will seek a new NASA authorization bill as quickly as possible. Lucas seems to also have plans for the Office of Space Commerce. He released a draft bill in the last days of the previous Congress that would elevate the Office of Space Commerce to a direct report to the Commerce Secretary. 

For those not paying attention to some of SpaceX’s subtler moves, SpaceX's Starshield initiative shows the company wants to take on bigger roles in national security. The article does seem to bury the lead since it is clear that SpaceX is going to try and take marekt share away from every single profitable sector in LEO if their competition isn’t willing or able to move fast enough to defend it. 

A paper criticizing the White House’s space policy framework is circulating some space policy circles. It is a well-stated analysis of how US space policy is still playing the Prestige Science game while everyone else is implementing hardcore industrial policy.

Starbridge 2023 Predictions

1. The first Starship flight attempt will occur in Q1 2023 - with just making it off the launch pad considered to be a huge success; the following Starship flight attempt will be late Q2 but it will fail on re-entry; and the first successful Starship flight to orbit will be in late Q4 of this year

2. One of the four lunar landers slated for 2023 will successfully land

3. An important space policy debate makes it to the minds of government leaders in 2023, focused on when and how much to regulate space; especially in regards to human spaceflight

4. There will be a test launch from an offshore floating launch platform in 2023. High cadence operational launch begins moving to offshore platforms starting in 2024.

5. Two space SPACs will either be acquired at the cost of debt or liquidated in bankruptcy

6. The War in Ukraine will continue into 2024 and EO companies will continue to benefit

7. A company will successfully launch and return intact a satellite from orbit

8. Russian relations with other ISS partners stabilize, at least in regards to space operations

9. Boeing reduces its human spaceflight business to simply servicing Artemis, and abandons Starliner

10. The explosion of small quantum communications and PNT companies slows but funding for in-space demonstrations increases

11. Private space funding increases and differentiates between SpaceX and everyone else

12. On average, seed stage valuations will largely maintain their previous highs while a ‘flat round’ will be considered the new ‘up round’ for later-stage companies this year

13. The inflation rate at the end of 2023 will be at or just above 6% which will begin to affect Federal budgets and discretionary spending will feel the most pressure

Bonus:

1. Jeff Foust will disclose that all of his articles written in 2023 were actually written by ChatGPT

2. Both Trump and Biden were found to have hidden top-secret documents about alien communications technology deep in their sock drawers

Other Space News

• Apollo 7 astronaut Walt Cunningham has died.

• Iridium enters service agreement for direct-to-smartphone satellite service - SpaceNews

• The United States and Japan signed a agreement establishing a framework for future cooperation in space exploration.

• NorthStar Earth and Space has raised $35 million to support development of a space situational awareness (SSA) constellation.

• Airbus Defence and Space is partnering with Voyager Space on its Starlab commercial space station.

• The Air Force Research Laboratory (AFRL) is working with a law firm on a regulatory "bootcamp" for space entrepreneurs.

• ISRO will work with Microsoft to support Indian space startups.

• General Atomics Electromagnetic Systems won a contract from Advanced Space to build a cislunar monitoring spacecraft.

• China's first Mars orbiter and rover appear to be in trouble.

• A startup is working to enable automatic networking in space using optical links.

• The one-time "SPAC king" that took Virgin Galactic public predicts that SpaceX will spin off Starlink as a public company this year.

• The U.S. Space Force is requesting information on laser communications systems to connect satellites in medium and high orbits.

• The FCC is one step closer to creating a Space Bureau.

• Russia will launch a Soyuz spacecraft without a crew to the International Space Station to replace a damaged Soyuz there.

• A retired general is the new CEO of space logistics company Skycorp.

• Capella Space announced it raised an additional $60 million to accelerate work on synthetic aperture radar (SAR) satellites.

• The U.S. military will need to take advantage of commercial innovation in order to effectively compete with China in space.

• The United States and Japan agree that an attack in space would trigger a mutual defense treaty.

• The problems exposed in Russia's military during its invasion of Ukraine are a warning to the U.S. Space Force, its top general said.

• A Falcon Heavy launched the first U.S. Space Force mission of the year Sunday evening.

• The Space Force is considering on-ramps for emerging companies in its next national security launch contract.

• Stratospheric ballooning company World View is going public through a SPAC merger.

• The first Vulcan Centaur rocket is on its way to Cape Canaveral.

• The new Republican leadership of the House Appropriations Committee has announced the chairs of its various subcommittees.

• The head of military space acquisitions says his efforts to reform procurement are gaining traction.

• A NASA project designed to ultimately send scientists on private astronaut missions to the International Space Station is being scaled back.

• China is still waiting to hear back from its first Mars rover.

• HawkEye 360 will provide data collected by its radio-frequency mapping satellites for a Space Force threat-detection system.

• Buzz Aldrin celebrated his 93rd birthday Friday in style by getting married.

• NASA and DARPA will cooperate on a program to demonstrate a nuclear thermal propulsion (NTP) system in space.

• Astrobotic has completed testing of its Peregrine lunar lander.

• A Colorado senator, meanwhile, is threatening to block Defense Department nominations until the Pentagon meets with him about Space Command's headquarters.

• The Commerce Department is planning to expand the space situational awareness services currently provided by the Defense Department.

• The two astronauts who flew the first commercial crew mission received medals at the White House Tuesday.

• The Space Force's Space Development Agency is planning a new procurement of 72 satellites.

• A startup is developing satellites that it claims could be used to disable other spacecraft.

• The Canadian Space Agency has started a public consultation on space regulatory reform.

• The Exploration Company, a European startup developing spacecraft to return cargo from space, raised $44 million this week.

• Pathfinder #31 with Jim Bridenstine - Payload

• ‘Wings like cracked eggshells’: Richard Branson faces turbulence over safety of space flights | Virgin Galactic | The Guardian

• Djiboutian Government signs MoU with HKATG to Build a USD 1 billion Spaceport in Djibouti - Space in Africa

• Why HBS Is Teaching MBAs about Space

• NASA and DARPA Partner on Nuclear Thermal Propulsion - Payload

• NASA Validates Revolutionary Propulsion Design for Deep Space Missions

• The Matthew Isakowitz, Patti Grace Smith, and Brooke Owens fellowships announced their 2023 cohorts. 

Looking Back at Starbridge's Predictions for 2022

Happy New Year Everyone!

We thought this would be a great time to look back at our (un)official predictions about the commercial space industry from the past year to hold our crystal ball accountable! 

This past year has seen a war in Europe, SLS and Artemis’ first flight, and a significant downturn in economic markets. However, it also saw gains in our portfolio companies, Earth observation became a much larger strategic asset, and an election in the US that left nothing settled except that Americans still enjoy a split Government. 

So here were our 2022 predictions from the end-of-2021 report to LPs, with our analysis of why they did or did not come true:

1. Satellite constellations continue growing rapidly as deployment picks up the pace; public concern of cluttering up space rises to match  (confidence level: 10/10)

   This one was an easy prediction since it was simply the extension of a trend. We did see SpaceX begin to deploy the first of its next generation (gen 2) of Starlink satellites in December. This adds to the 3,300 (or so) Starlink gen 1 satellites already in orbit.  In December, the FCC authorized Starlink to launch up to 7,500 Gen 2 satellites over time; SpaceX’s ultimate target is 30,000. Also, on the regulatory side, the US Federal Government proposed several significant regulatory changes in an effort to pre-empt future ‘space junk’ issues; the first of which is the reduction in time to de-orbit an end-of-life spacecraft from 20 years to 5 years.

2. More humans make it to space (and back) than in any other year as commercial crewed vehicles increase their launch frequency (for gov’t crews 6/10; for private crews 9/10)

   42 people visited space in 2022, according to the US definition of where space starts, which was actually 3 fewer than in 2021. This was due to Russia’s deteriorating space program (which was accelerated by the invasion of Ukraine in February) and the loss of Blue Origin’s New Shepard-23 flight (although it was a cargo launch, this resulted in 1-2 crewed missions to not fly in the 4th quarter).

   Of note: Axiom Space flew the first commercially crewed mission to the ISS and China completed its first crew rotation on its recently completed Tiangong space station.

3. SpaceX gets a fully tested orbital Starship working and landing. This would be a monumental achievement, but SpaceX appears to be on pace to do it (8/10)

   While Starship did not fly in 2022, SpaceX has said that the first test of the full-up vehicle could come as soon as the end of February. Unfortunately, this might mean that Starbridge GP Michael Mealling owes some friends a steak dinner.

4. Space SPACs will likely find their supportable valuations by year’s end… or else at least 3 of them will get acquired (7/10)

   Many of the space SPACs may have found their supportable valuations late in December of this year, but at a far lower value than what was expected back in January. None of the space SPACs are above their original $10 SPAC price currently, and some such as Astra are trading as low as 44 cents. The highest price currently is AST SpaceMobile at $4.82 (as of our last check). None have been acquired and several year-old+ SPACs that were in process have been canceled; though word is that at least a couple are bucking the trend and will be working their way across the public finish line in 2023.

5. China to complete its Tiangong space station (8/10)

   As noted above in #2, China successfully completed its space station in November and completed their first crew rotation later that month.

6. India gets back to record mission schedule in 2022 after their 2021 launch failure (7/10)

   India is back to business in a big way and recently launched 36 OneWeb satellites in October.

7. Look for new space SPAC deal announcements to pick back up in the second half of 2022 as institutions have had time to reorient structures and financing. This also will reflect the two year countdown for the SPAC sponsors that was started in 2020 and 2021 (6/10)

   While there is a current slight uptick in SPAC offers in the market, this is primarily due to many expiring and the sponsors not wanting to lose their risk capital. The environment for completely new SPAC offerings is still quite dim. The only new space-related SPACs to form at the end of this year are by Kam Gaffarian, co-founder of Axiom Space.

8. Boeing Starliner flies a crew before the end of 2022 (mmm…5/10)

   While an uncrewed Starliner did manage to fly in 2022, the first crewed flight is now expected no earlier than April 2023.

9. Immediately after the first Starship flies to space and successfully lands in 2022, a previously unknown organization announces that it has identified and contracted with 1000 people to fly to Mars and that the first crew of twelve will launch during the 2026 Earth/Mars launch window (5/10)

   Not only did Starship not fly, but no new human spaceflight company appeared to take advantage of that market. We still think SpaceX will send something to Mars in the 2024 window, but our previous prediction moves to 2023.

10. Of the nine cargo missions (currently scheduled) to or around the Moon in 2022, at least three of them will fly this year (4/10)

    Three missions did fly this year but none have made it to the Moon yet. This was our lowest conviction prediction of 2022 and an indicator of how fast (or slow) lunar development plans match up to the difficulties of engineering and economic reality.

Stay tuned for Starbridge’s 2023 list of predictions!

Starbridge Weekly Space Update for 12/19/2022

Portfolio Company News

SpaceX

• While some wonder if social media company Twitter can survive under its new owner, Elon Musk, Others wonder if Musk and his space ambitions can survive Twitter.

• Elon Musk's poll results are in: He should step down as Twitter CEO, Twitter voters say 

• SpaceX will sell shares at a new, higher valuation.

• Falcon 9 issues are magnified by a chokepoint in the launch market, with few other options for launching payloads by the U.S. and other Western nations.

Axiom

• A NASA official is confident that new spacesuits will be ready in time for the first Artemis lunar landing mission.

General Space News

Advent buying Maxar

Advent International, a private equity firm that seeks “to invest in well-positioned companies with operational and strategic improvement potential” with $89B AUM, is offering a 129% premium for Maxar, a space infrastructure and Earth intelligence company best known for its imagery of the conflict in Ukraine. 

The $53/share purchase price represents a 129% premium to the prior closing price of $23.10 and a 34% premium to the prior 52-week high. This values Maxar at an enterprise value of $6.4BB, with Maxar holding $2.17BB of long-term debt and $22MM of short-term debt as of the end of Q3. Based on revenue and EBITDA estimates, the deal is valued at 3.3X 2023 EV/Sales and 12.1X EV/EBITDA.

The deal includes a 60-day "go-shop" period expiring February 14, 2023. The deal is expected to close in mid-2023, following regulatory and shareholder approval.

In the press release by Maxar, Advent indicated that its rationale was Maxar’s position in the market and the limitations on its potential by being public. Advent says that post-merger, “Maxar will benefit from the significant resources, operational expertise, and capacity for investment provided by Advent. As a private company, Maxar will be able to accelerate investments in next-generation satellite technologies and data insights that are vital to the Company’s government and commercial customers, as well as pursue select, strategic M&A to further enhance the Company’s portfolio of solutions.”

L3Harris buying Aerojet

Much pursued Aerojet has agreed to be purchased by L3Harris at a purchase price of $58/share which, including debt, estimates the value of the entire deal at $4.7B. Aerojet makes liquid- and solid-fueled propulsion products for space and munitions applications. Its space focused products include the SLS’s RS-25 engines, the Orion spacecraft’s main engine, the RL-10, and in-space electric propulsion products. 

L3Harris’ rationale for the deal is the increasing demand for munitions and systems from the Department of Defense. The deal, expected to close mid-2023, is financed by L3Harris from existing cash on hand and new debt.

Aerojet has had recent offers from both Lockheed Marting and GE. The FTC blocked a $4.4B takeover bid from Lockheed Martin ($LMT), saying the merger could inflate the cost of rocket engines for other contractors or even lock out their access to the supplier. Reports of GE’s interest provided no details on their offer. 

Courtesy of the team at Payload, we are reminded of the State of Competition within the Defense Industrial Base and its conclusions. There were 51 prime contractors in the ’90s. Now, there are five: Lockheed Martin (NYSE:LMT), Raytheon (NYSE:RTX), General Dynamics (NYSE:GD), Northrop Grumman (NYSE:NOC), and Boeing (NYSE:BA). While the space sector has become much more dynamic, the rest of the defense sector has continued to ossify. It will be interesting to see if companies such as Anduril provide a solution to the problem. From the report above:

National Space Council/Office of Science and Technology Policy

The White House released two important announcements today: the new appointees to the National Space Council Users Advisory Group and the National In-space Servicing, Assembly, and Manufacturing Implementation Plan. 

These announcements, the FCC’s announcement of a Notice of Proposed Rule Making for updating its satellite application process, and bills proposed by Congress demonstrate significant regulatory changes starting in January as the 118th Congress begins. 

Hedron

Hedron, originally Analytical Space, was reorganized, refinanced, and senior staff remixed late last year. The new COO, Katharine Monson, sat down with Payload and outlined their plans for a high-speed, low-latency relay network. 

Other Space News

• A Soyuz spacecraft docked to the International Space Station suffered a coolant leak late Wednesday, scrubbing a spacewalk.

• The United Nations General Assembly approved a resolution calling on nations to halt destructive direct-ascent ASAT tests.

• Some Western researchers are planning to fly experiments on China's space station rather than the International Space Station.

• A new animated series will feature Blue Origin, its founder and one of its customers.

• Rwanda and Nigeria became the first African countries to sign the Artemis Accords Tuesday.

• Quantum Space raised $15 million to further the development of cislunar spacecraft.

• The United Arab Emirates may provide an airlock module for the lunar Gateway.

• A NASA official said the agency is willing to work more closely with India on its human spaceflight program.

• The Space Force's acquisition head says he wants to buy smallsats with fixed-price contracts.

• Upper-level winds scrubbed Rocket Lab's launch of an Electron rocket from Virginia Sunday.

• NASA signed a spaceflight safety agreement with AST SpaceMobile.

• VentureScope, a consulting and venture investment firm, won a contract to set up an internal accelerator for the U.S. Air Force.

• South Korea's Danuri spacecraft has entered orbit around the moon.

Starbridge Weekly Space Update for 12/12/2022

Joseph Y. Bae, co-CEO of KKR

"Private capital is much more valuable today than it was last year or five years ago. That's going to create some really, really interesting buying opportunities."

Warren Buffett's instruction to "be greedy when others are fearful" has become doubly important as most investors have pulled back somewhat from both public and private markets exposure. Bae's statement above illustrates the power asymmetry that this creates in private markets in particular where the number of investors is limited enough that investors who are willing to invest have greatly increased pricing power. $1 invested now has roughly the same buying power as $2, or even $3 last year.

Portfolio Company News

SpaceX

SpaceX launched 40 OneWeb satellites Thursday in the first of three launches for its megaconstellation rival.

Space Forge

Virgin Orbit is delaying its first United Kingdom launch, likely until after the end of the year. (Space Forge's first flight is on this Virgin Orbit launch.)

Space News

Artemis I Splashes Down

Artemis I is complete. At 12:40pm ET yesterday, the Orion capsule splashed down in the Pacific, marking the end of its 26-day, 1.4-million-mile journey around the Moon and back again.

dearMoon

Japanese billionaire Yusaku Maezawa announced the crew he selected for a Starship flight around the moon. The selection was based on their desire to push the envelope on how space can help other people and greater society in some way plus their sense of teamwork and collaboration with the rest of the crew. Space Twitter (yes, it's a thing) was very happy to see Tim Dodd, the Everyday Astronaut, as one of the selectees. 

Japanese Commercial Lunar Mission

The first commercial mission to the Moon turns out to NOT be an American company. ispace launched the HAKUTO-R M1 spacecraft on a Falcon 9 rocket on Friday and is now almost halfway to the Moon.

The National Team 2.0

Blue Origin has revamped its bid for a second human lunar lander by reorganizing the National Team and dropped Northrop Grumman, leaving Lockheed Martin, Draper, Boeing, Astrobotic, and Honeybee Robotics. Northrop Grumman was part of the previous incarnation of the team but has since decided to partner with Dynetics instead. 

South Korea

Hanwha Aerospace, the aerospace and defense subsidiary of a South Korean conglomerate, secured a contract worth ₩286B ($212M) to build three rockets for the country’s space program. South Korea is massively upping its space game.

Space Traffic Management

The Department of Commerce's Office of Space Commerce has finally awarded contracts for space traffic coordination pilot project. While many in Congress prefer space policy to live in this office, there is some suggestion that the White House prefers it live in the FAA.

Regulators Gotta Regulate

There are numerous rumors and non-rumors surrounding the US Government introducing some very significant new regulations in the coming months. The only debate seems to be which agencies do the regulating:

The leadership of the House Energy and Commerce Committee introduced bills to reform FCC satellite licensing rules. and The White House is reportedly drafting an executive order to help streamline space licensing.

Other Space News

• Slingshot Aerospace Raises $40M Series A-2

• Saudi Arabia in talks over plans for next-generation space stations

• Relativity rolls out to the pad

• China is considering expanding its Tiangong space station - SpaceNews

• Astroscale Japan and JAXA Launch Co-Creation Project for Satellite Refueling Service Concept

• 'Compromise' NDAA boosts Space Force budget, but keeps tight reins on policy decisions - Breaking Defense

• Megaconstellation startup E-Space is buying communications hardware company CommAgility for $14.5 million.

• The Defense Science Board will examine the military’s growing demand for commercial space technology and its implications.

• Russia's prime minister says his government is finalizing an agreement with China on the International Lunar Research Station (ILRS).

• Sierra Space won a contract to provide power systems for Maxar satellites.

• Mynaric is partnering with two other companies on a laser communications terminal it is developing for DARPA.

• A NASA mission to look for near-Earth objects (NEOs) will move into its next phase of development.

• TriSept and SpiderOak are partnering to provide "end-to-end" cybersecurity for satellites and ground systems.

• ISRO is reportedly being told to conduct its first crewed launch before elections in 2024.

Starbridge Weekly Space Update for 12/5/2022

Portfolio Company News 

Lynk

• Optus and Lynk conduct a live demonstration of LEO satellite-to-mobile technology in Australia

SpaceX

• SpaceX conducted another static-fire test Tuesday of the Super Heavy booster for its first orbital Starship launch attempt.

• SpaceX has indefinitely postponed the launch of a Japanese lunar lander because of an issue with the Falcon 9 rocket.

• The British government, a part-owner of satellite broadband company OneWeb, is rolling out a rural connectivity pilot project… with Starlink.

• The FCC will allow SpaceX to begin deployment of its second-generation Starlink constellation while it reviews the overall 30,000-satellite proposal.

General Space News

NASA cancels GeoCarb greenhouse gas monitoring mission - SpaceNews

GeoCarb appears to have been canceled by NASA due to cost overruns, technical concerns, and the availability of commercial sources able to provide equal or better data at a fraction of the cost. *

Rocket Lab launches a subsidiary focused on the national security market

SpaceX rolls out new business line focused on military satellite services

Possibly taking a cue from Anduril, both SpaceX and Rocket Lab are creating vertically integrated, one-stop solutions for DoD applications. While DoD may appreciate this approach in the short term, the DoD has always been willing to pay extra to ensure that multiple providers exist. The question will be whether either can build something so comprehensive that no one can duplicate it. 

Three Chinese astronauts returned to Earth Sunday after six months on the country's space station.

The first crew of China’s space station landed in China on Sunday, completing their mission to assemble all of the station modules and welcoming the new crew to the fully operational space station. 

Congressional Leadership Update

Unless something strange happens, it appears that Frank Lucas (R-OK, 3 - northern district of Oklahoma), former Ranking Member of the House Science Committee will become the new committee chair, and Zoe Lofgren (D-CA,19 - San Jose and Santa Clara area) will be the Ranking Member. Robert Aderholt  (R-AL) remains on the House Commerce, Justice, and Science (CJS) Appropriations subcommittee so it's clear that Northern Alabama is still well defended. 

Other Space News

• The head of the U.S. Space Force says the war in Ukraine is a sign of what future use and reliance upon satellites will look like.

• AST SpaceMobile, Inc. Announces Launch of Offering of $65,000,000 of Class A Common Stock

• Virgin Orbit Abandons Securities Offering Amid Shrinking Cash Reserves, Financial Losses and Launch Delays

• GomSpace signs EUR 18 million credit facility agreement with the European Investment Bank

• BlueWalker 3 Breaks Satellite Brightness Records - Payload

• SiriusXM Orders Two New Satellites from Maxar - Payload

• ICON Wins NASA Contract for Lunar 3D Printing - Payload

• A Chinese cargo spacecraft deployed a smallsat after undocking from the Tiangong space station earlier this month.

• South Korea's president says the country will land spacecraft on the moon in 2032 and Mars in 2045.

• Astra's chief engineer is stepping down as part of a company reorganization.

• A Japanese billionaire and space tourist says he will make a space-related announcement later this week.

• Spaceport Cornwall receives first U.K. spaceport license

• Rocket Report: SpaceX launch delayed indefinitely; Virgin Orbit cancels funding round

Starbridge Weekly Space Update for 11/28/2022

Portfolio Company News

Axiom

While Hungary previously announced plans for sending astronauts to the ISS via Axiom, at the ESA ministerial they announced that they plan to spend $100 million to send a single astronaut to the ISS in two years. 

General Space News

This week's news is significantly abbreviated due to the Thanksgiving holiday last week. With the last month of the year just around the corner and the 118th Congress starting on January 3rd, expect the news to heat up quite a bit over the next four weeks. 

In a success for commercial space and CubeSats in general, the CAPSTONE lunar CubeSat mission is now operational after refining its orbit.

European Space Agency Ministerial Meeting

European Space Agency (ESA) member states have agreed to commit 16.9 billion euros ($17.5 billion) to agency programs over the next three years. The figure is short of the roughly 18.5 billion euros ESA sought going into the meeting, but a significant increase over 2019.

ESA also announced that it had elected a new class of 5 "career astronauts, 1 "parastronaut" who will be part of a feasibility study to see if people with physical disabilities can fly to space, and 11 "reserve" astronauts who may be available for future astronaut activities. 

France, Germany, and Italy also announced an agreement Tuesday on launch vehicle development.

Possibly as a result of knowing it wouldn’t receive full funding and that European launch systems were becoming more uncompetitive, ESA used the meeting to describe a more sustainable path for space exploration it would be implementing, starting with growing commercial partnerships in lunar exploration. 

China

Not to be outdone by Europe, China provided new details about its long-term human and robotic lunar exploration plans. China tied its newly completed Tiangong space station to testing key technologies required for space-based solar power.

Other Space News

• NASA's Orion spacecraft went into a distant retrograde orbit around the moon Friday.

• The U.S. Space Force is planning a new contract for rideshare services.

• The Space Systems Command has established a new office that will try buying technologies using a services approach.

• Astronomers have detected active chemistry in an exoplanet for the first time.

• The space station crew got next-day delivery of cargo over the weekend.

• An Indian rocket launched an Earth observation satellite and eight nanosatellites.