Wed. Oct 27th, 2021

Firms that operate both geostationary and low-Earth-orbit constellations claim they see chances to buy complementing firms but caution that the industry’s long-anticipated consolidation is unlikely to happen anytime soon. Bret Johnsen, SpaceX’s chief financial officer, spoke on a panel at the Satellite 2021 conference on September 7 about his company’s covert purchase of Swarm Technologies. This startup operates a constellation of smallsats that provides internet-of-things services. Swarm submitted a proposal with Federal Communications Commission in the month of August to transfer the licenses to SpaceX, but neither company announced the arrangement.

He said the deal is still undergoing a regulatory assessment known as Hart-Scott-Rodino, and he wouldn’t reveal the terms of the arrangement. His justifications for the arrangement are similar to those stated in Swarm’s FCC submission. “We found a company with some fascinating intellectual property and a terrific team that we can effectively utilize,” he explained. “It seemed like the ideal time.”

Johnsen left the possibility of more agreements open. He admitted, “Obviously, we haven’t been extremely acquisitive in the past.” “I believe we would look into it if there was something which met the right requirements.” OneWeb’s CEO, Neil Masterton, said his business is focusing on small, targeted purchases, noting the company’s acquisition of TrustComm, which is a managed satellite communications supplier, in May as an example. TrustComm gave OneWeb access to the US government market.

He explained, “These are capability fillers that help us on the organic build-out.” “We’ll look at other, smaller ‘tuck-ins’ that allow us to expand our skills to serve our customers better.” Hadi Alhassani, who serves as the vice president and the chief strategy officer of (CSO) Arabsat, said his business is looking into a handful of prospective acquisitions of many other regional satellite providers to increase its geographical reach. He stated, “To be truthful, this is a fantastic time to acquire.” “There are some good buys in GEO.”

However, this does not rule out the possibility of a satellite operator merger. “Every year at this conference, people question if this is going to be the year that consolidation will happen,” stated Matt Desch, CEO of Iridium. “For the most part, it still hasn’t. But, in the end, some will be forced to.”

He continued, “I’m not sure the place we are as an industry.” “Right now, we’re in a tumultuous situation. There are a lot of businesses that aren’t doing so well.” According to Desch, Iridium is open to evaluating acquisitions but does not feel compelled to do so given the excellent cash flow.

He continued, “I don’t believe there will be a sudden torrent of mergers.” “Unless everything breaks apart, in which case people may rush to take things. But I believe that is still a long way off.”

Leave a Reply

Your email address will not be published. Required fields are marked *