Space is cold, but space investing continues to be hot. Two special purpose acquisition companies announced mergers with space companies Monday.
Spire Global, for starters, is merging with the SPAC NavSight (ticker: NSH).
Spire is a data provider to global companies. “We collect data once, refine it, and sell it a million times,” says CEO Peter Platzer. A constellation of more than 100 Spire satellites sends terabytes of data down to Earth each day. “We are fully deployed,” he said.
The merger values Spire stock at about $1.6 billion, based on 164 million shares outstanding on a fully diluted basis. NavSight stock was up about 7% to $11.15 in morning trading, making Spire stock worth about $1.8 billion.
Spire will get about $445 million in cash after fees from the deal—$230 million from NavSight’s trust and $245 million from a public investment in private equity, or PIPE, funded by Tiger Global Management, BlackRock, and other investors at $10 a share. Spire plans to have about $900 million in sales and $425 million in earnings before interest , taxes, depreciation and amortization, or Ebitda, by 2025.
The larger of the two transactions is a combination of Vector Acquisition Corp (VACQ) and Rocket Lab USA, which comes in at an enterprise value of $4.1 billion based on 483 million shares outstanding on a fully diluted basis.
Vector stock was up almost 30% Monday, which values Rocket Lab stock at about $6.4 billion. That makes it one of the most valuable pure-play space stocks. Other space stocks coming to market via SPAC mergers include BlackSky, Momentus, and Astra.
Black Sky is merging with Osprey Technology Acquisition (SFTW). Momentus is merging with Stable Road Acquisition (SRAC) and Astra is merging with Holicity (HOL).
Rocket Lab is a miniature version of Elon Musk ‘s SpaceX, which is valued at about $74 billion. That’s more than Rocket Lab, but the company can deliver satellites with its own rockets and plans to offer services from its own satellites, similar to SpaceX’s strategy. SpaceX is planning to offer space-based high-speed internet using its Starlink satellites.
Vector’s deal with Rocket Lab will provide the company with about $740 million in cash after expenses, coming from the SPAC’s $320 million trust and a $470 million PIPE from institutional investors including Vector Capital (the SPAC’s sponsor), BlackRock, and Neuberger Berman.
Rocket Lab expects to have close to $1.6 billion in revenue in 2027, up from a forecast $69 million this year. Management also sees the company first breaking even on a free cash flow basis in 2024. Spire expects to begin generating free cash flow in 2023.
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