Sponsored by TCI International Inc.
15 Oct 20. Pentagon officials see ‘troubling’ small business decline since COVID. Over recent months, the U.S. Defense Logistics Agency has awarded hundreds of millions of dollars in contracts for the federal response to the coronavirus pandemic, but that’s not necessarily benefitting the Defense Department’s usual vendors.
In fact, the Pentagon contracting arm is seeing fewer small businesses in its traditional supplier base competing for contracts in the wake of the coronavirus pandemic, the director of the DLA’s Office of Small Business Programs, Dwight Deneal, said Tuesday.
“Our percentages [of small business involvement] are as high as they’ve ever been over the past five years, but we are recognizing that the participation level from our supplier base’s standpoint has steadily declined,” Deneal said at a small business panel at the Association of the U.S. Army’s annual meeting, which was being conducted virtually.
“So [the DLA is] looking at the gaps in there and how do we strategically attack those areas where some of our suppliers are just not participating in or winning some DLA contracts,” Deneal said, adding that the agency plans to roll out a new virtual outreach effort next month to reengage its small suppliers.
The comments came as the Pentagon faces congressional scrutiny amid reports it awarded lucrative contracts for disposable medical gowns to a handful of unexpected and inexperienced companies despite bids from more than 100 vendors with track records of successfully completing federal procurement contracts.
To boot, the Pentagon’s allocation of $688m to aid troubled suppliers of aircraft engine parts as well as shipbuilding, electronics and space launch services is facing anger on Capitol Hill because the money wasn’t spent to increase the country’s supply of medical equipment. Pentagon officials have denied any wrongdoing and stressed the need to support companies large and small that make up the defense industrial base.
Without mentioning either controversy, Deneal said the DLA’s dealings on personal protective equipment contracts reflected a commitment to small businesses and efforts to revive domestic supply chains for PPE, widely regarded as a necessity in the wake of the pandemic.
“A lot of companies are starting to pivot their assembly lines to start to get into the business of producing PPE, and that has been quite clear from some of our last solicitations … for gowns, where we had robust competition from small businesses ― companies that had traditionally never bid on government contracts,” Deneal said.
“We were able to allow that competition pool and subsequent awards to be small business awards, and I think that speaks to the importance that DLA sees and [places on] the small business community,” Deneal added. “It goes to show how our acquisition community is forward thinking and forward leaning.”
The decline in small business participation extends beyond the DLA. The director the Navy’s Office of Small Business Programs, Jimmy Smith, said his data showed a similar and “troubling” trend in need of targeted contracting activity by the Navy.
“We’re spending about the same, equivalent money every year, but one of the things we’re watching in our supplier base is a pretty steep decline in industry partners in certain areas,” Smith said. “I think [it’s] incumbent upon us to understand what those shortcomings are and [offer] some solicitations, sources sought in a number of areas where we are seeing a decline in industry partner involvement.”
Smith plans to address the gap in the coming year by pushing contacting officers to directly deal with small businesses and by enforcing agreements with large contractors that they flow work to smaller partners.
“It’s definitely troubling from our standpoint on making sure we’ve got a viable supplier base,” Smith said. “Having a fragile supplier base does us no good, and it actually impacts the war fighter in negative ways.” (Source: Defense News)
15 Oct 20. Rolls-Royce prices £2bn equivalent bond to boost finances. Rolls-Royce said it had successfully priced a £2bn ($2.6bn) equivalent bond offering in three tranches, more than the £1bn it was aiming for due to strong demand from investors for the notes.
Rolls, the aero-engine maker whose finances have been strained by the pandemic, said on Thursday the bond offering was expected to close on Oct. 21 and the proceeds would be held in escrow until the successful completion of its rights issue.
The company announced a plan to strengthen its balance sheet earlier in October, which includes a £2bn rights issue plus the bond and other measures. (Source: Reuters)
15 Oct 20. Honeywell (NYSE: HON) has acquired assets from privately held Ballard Unmanned Systems, a wholly owned subsidiary of Southborough, Mass.-based Ballard Power Systems Inc. Ballard Unmanned Systems designs and produces industry-leading, stored-hydrogen proton exchange membrane fuel cell systems that power unmanned aerial systems (UAS), particularly those used for energy inspection, cargo delivery, and other commercial and defense applications where demand for UAS services is growing.
Honeywell is acquiring the key intellectual property, inventory and equipment of Ballard Unmanned Systems. Ballard’s team of fuel-cell experts will also join Honeywell as part of the acquisition.
“Adding Ballard Unmanned Systems to the Honeywell family is another example of our commitment to invest in the growing UAS segment,” said Mike Madsen, president and chief executive officer, Honeywell Aerospace. “We can now begin producing top-quality, scalable power systems for our UAS customers and eventually adapt these systems for other future aerospace, defense and adjacent segment applications.”
Fuel cells function much like traditional batteries but with a key difference: They don’t run out of power or need to be recharged. A fuel cell uses the chemical energy of hydrogen or another fuel to cleanly and efficiently produce electricity. Unmanned aerial systems powered by fuel cells can fly longer distances, are quiet and have zero greenhouse gas emissions.
Ballard Unmanned Systems’ fuel cell power systems can run up to three times longer than batteries and are five times more reliable than small engines. Furthermore, unlike traditional gas engines that have carbon emissions, they utilize hydrogen, a clean source of energy.
With the added capabilities of Ballard Unmanned Systems, Honeywell intends to introduce a family of fuel cell power systems for a variety of UAS vehicles. Honeywell will also collaborate with Ballard Power Systems on broader aviation applications.
Honeywell offers certification expertise as well as a full line of avionics, propulsion and operational systems for unmanned aircraft and UAM vehicles. In June, the company launched a business dedicated to UAS and Urban Air Mobility. Additionally, in September Honeywell opened a new research and development lab to demonstrate the company’s technological capabilities in both hardware and software for the UAS and UAM markets.
Terms of the deal were not disclosed, and there is no change to Honeywell’s third-quarter 2020 outlook as a result of the acquisition.
13 Oct 20. Karem seeks investment for its Optimum Speed Tilt-Rotor. Karem Aircraft is seeking investment to get its Optimum Speed Tilt-Rotor (OSTR) technology on to an aircraft for flight, according to a company official.
A propulsion system’s revolutions per minute (RPM) can be varied in different flight conditions with an optimum speed rotor to improve the performance or signature. Bruce Tenney, Karem military vertical take-off and landing (VTOL) business development director, told Janes on 5 October ahead of the annual Association of the United States Army (AUSA) trade show that a problem with convertiplanes, which includes tiltrotors, is that they use the same rotor speed for both vertical lift and forward flight conditions. There is always a design compromise between those flight conditions, leading to inefficient use of the rotors.
The rotorhead and swashplate on an Airbus H125/AS350 helicopter. The swashplate is the white part (bottom) at the base of the rotor shaft. The pushrod actuators are the vertical components. Karem’s OSTR technology seeks to eliminate the swashplate because it is mechanically complex, heavy, requires a lot of maintenance, creates a lot of drag, and requires more engine power and fuel consumption for the aircraft to fly at higher speeds (Vertical Flight Society)
Current tiltrotors, such as the Bell Boeing V-22 Osprey, reduce their RPM by about 15% in cruise. The OSTR reduces the RPM of tiltrotors in forward flight to about 50-55% of the revolutions needed in a maximum weight hover condition. Aircraft need 100% speed on the rotor when the platform is hovering for maximum lift, but need less rotational speed when that rotor tilts forward and becomes a propeller for forward flight.
Reducing RPM in forward flight, Tenney told Janes on 8 October, improves efficiency and reduces fuel consumption. It also reduces the noise levels associated with the rotor and engine. (Source: Jane’s)
14 Oct 20. vHive Secures $4m in an Investment led by Deutsche Telekom to Accelerate Expansion in the Enterprise Drone Hive Software Market. Funding will support vHive’s rapid growth trajectory as it helps enterprises gain business insights to their field assets while streamlining costs
- vHive’s platform digitizes enterprise’s field assets using autonomous drone hives, powering their digital business transformations.
- Deutsche Telekom, one of the world’s leading integrated telecommunications companies is making a strategic investment in vHive to propel further expansion in the telecom industry.
- Enterprises benefit from accurate data analytics and insights about their field operations creating a tremendous market opportunity for vHive’s technology.
vHive, the only software solution that enables enterprises to digitize their field assets and operations using autonomous drone hives, announced today a $4m extension to its Series A, led by Telekom Innovation Pool (TIP), Deutsche Telekom’s strategic investment fund advised by DTCP. Existing investors Octopus Ventures and StageOne Ventures participated in the funding, which will accelerate the company’s growth and expansion in the enterprise drone software market. Joel Fisch, Deutsche Telekom Vice President and TIP Co-managing Director has joined the Company’s board of directors.
Deutsche Telekom, one of the world’s leading telecommunication companies, is investing in vHive to fuel the company’s continued expansion in markets that are going through digital transformation using autonomous drone hives. These markets include telecom, construction, cranes, insurance and others. The investment will support vHive’s leadership in data analytics, computer vision and AI, and further automate recognition of items of interest. Deutsche Telekom with its global portfolio, will assist in applying vHive’s solution in the Telecom space.
“We are thrilled to have the backing of a significant industry player such as Deutsche Telekom as a testimonial to vHive’s innovation,” said Yariv Geller, CEO and co-founder of vHive. “Deutsche Telekom’s investment demonstrates their commitment to digitizing their infrastructure using the vHive platform as well as the acceptance of drones, digital twins and data analytics as a significant telecom industry practice with clear use cases and ROI.”
vHive’s unique software platform is built with its customer journey in mind. Its end-to-end solution enables organizations to produce 2D and 3D Digital Twins of assets such as cell towers, cranes and structures and uses AI and analytics to generate business and operational insights. The software provides an intuitive user interface for inspection, measurement and identification of equipment and faults. vHive has trained its AI and computer vision algorithms on a broad data set composed of real assets that unlock new use cases with a precision that is hard to replicate for competitors.
“The last decade has seen an explosion of end-device processing power, imaging technology and cloud compute. Coupled with advances in drone technology and increasingly sensitive sensors, this has created disruptive opportunities around how to capture and analyze the physical world,” said Deutsche Telekom Vice President and TIP Co-managing Director, Joel Fisch. “vHive sits at the confluence of these trends and is developing technology and business models for digitizing physical assets as a new drone ecosystem comes into being.”
vHive has been working closely with Deutsche Funkturm GmbH as an integral part of its digital transformation process. As a provider of radio infrastructure, Deutsche Funkturm acquires, plans, realizes, operates, and markets radio sites throughout Germany. The joint work, which is now materializing into a long-term relationship, digitizes Deutsche Funkturm’s assets and provides operational insights using autonomous drones.
“The greatest added value to be gained from our cooperation with vHive is in continually managing ‘digital twins’ of our portfolio. Through the precise digitization of our sites and the analytic insights generated using vHive’s innovative software solution, we expect a sustainable increase in efficiency and quality,” says Martin Bouchard, Chief Operating Officer of DFMG Deutsche Funkturm GmbH.
vHive is a global leader of drone software solutions. vHive accelerates enterprises’ continuous digital transformation, enabling them to make better decisions based on accurate field data and analytics. vHive is the only software solution that enables enterprises to deploy autonomous drone hives to digitize their field assets and operations. vHive is making an impact in a variety of industries including communication towers, construction, insurance and rail by dramatically cutting operational costs, generating new revenue opportunities and boosting employee safety. Learn more at www.vHive.ai (Source: PR Newswire)
13 Oct 20. Ansys Startup Program Gains Global Momentum with Triple-Digit Growth. Program grows by 100% in just two years, 1000 startups across multiple industries digitally transforming with Ansys
- More than 1000 startup companies from around the world are using Ansys simulation solutions to innovate next-generation products and processes
- Ansys Startup Program participants utilize Ansys tools to reduce development costs, boost productivity, elevate efficiency and win the race to market
From 3D printing rockets to building electric motorcycles to reinventing how produce is grown, more than 1000 startup companies from around the world are employing Ansys (NASDAQ: ANSS) simulation solutions to design next-generation products and processes. Launched in 2016, the rapidly expanding Ansys Startup Program has doubled in size over the last two years, supporting startups from 44 countries across a range of industries including aerospace and defense, high tech, energy, automotive and many more.
Faced with limited funding and revenue, many startups must rely on building and testing physical prototypes to verify product performance, which often requires considerable financial and human resources. The physical prototyping process is also notoriously time-consuming, which increases barriers for winning the race to market against potential competitors. To overcome these challenges, entrepreneurs are using Ansys engineering simulation solutions to design and validate product performance with a minimum investment of time and cost.
The Ansys Startup Program equips the startup ecosystem with access to Ansys’ broad portfolio of simulation solutions, bundled and affordably priced to help early-stage entrepreneurs grow their businesses quickly while stretching their funding further. This enables engineers to validate product performance and reliability within virtual environments — significantly reducing physical prototype tests.
The Onward Project, a recent addition to the Ansys Startup Program, leverages Ansys® Discovery™ to optimize the design of AdvenChair, a first-of-its-kind, all-terrain, human-powered wheelchair that blends an adjustable sit-ski seat with mountain bike technology to help riders traverse challenging wilderness trails.
“We created the AdvenChair so that people with mobility issues can continue enjoying the great outdoors, beyond where the pavement ends,” said Geoff Babb, AdvenChairman of The Onward Project. “Upfront simulation is a necessity for us to make that vision a reality. We’re implementing Ansys Discovery into our design process to reduce weight, maintain structural integrity and ultimately cut costs, resulting in a better, more budget-friendly product.”
Firefly Aerospace joined the Ansys Startup Program in 2017, using a combination of Ansys solutions to design launch vehicles capable of taking small payloads to space. The company became a commercial Ansys customer in 2019 and still relies heavily on Ansys for everything from fluid dynamics to heat transfer to metallic propulsion hardware.
“At Firefly, our work is quite literally rocket science,” said Tom Markusic, CEO of Firefly Aerospace. “It takes an enormous amount of simulation and modeling to design components that withstand the tremendous liftoff, flight and space environments. Leveraging the suite of Ansys tools allows us to ensure a design works with limited test iterations, providing up to $5m in cost savings in engine cooling design, $10m in increasing engine thrust and up to $500,000 in mass optimizations.”
“Ansys views simulation as a superpower and, in many cases, startups are the true superheroes,” said Prith Banerjee, chief technology officer at Ansys. “The Ansys Startup Program champions the next era of startup companies, equipping them with cutting-edge, cost-effective simulation solutions to pioneer new products that push the envelope of what’s possible and quickly scale their businesses.”
If you’ve ever seen a rocket launch, flown on an airplane, driven a car, used a computer, touched a mobile device, crossed a bridge or put on wearable technology, chances are you’ve used a product where Ansys software played a critical role in its creation. Ansys is the global leader in engineering simulation. Through our strategy of Pervasive Engineering Simulation, we help the world’s most innovative companies deliver radically better products to their customers. By offering the best and broadest portfolio of engineering simulation software, we help them solve the most complex design challenges and create products limited only by imagination. Founded in 1970, Ansys is headquartered south of Pittsburgh, Pennsylvania, U.S.A. Visit www.ansys.com for more information.
Ansys and any and all ANSYS, Inc. brand, product, service and feature names, logos and slogans are registered trademarks or trademarks of ANSYS, Inc. or its subsidiaries in the United States or other countries. All other brand, product, service and feature names or trademarks are the property of their respective owners. (Source: PR Newswire)
16 Oct 20. Racal Acoustics launch a new website and sign a contract with PR agency, Chamois. Racal Acoustics, the UK-based global designer and manufacturer of audio communications and protection systems has today launched a brand new website (www.racalacoustics.com). To coincide with this, they have also signed a contract with PR and advertising agency, Chamois Consulting Ltd. Under this contract Chamois will provide an integrated marketing, communications and advertising service with a particular focus on brand communications and PR. They have a clear remit to raise the profile and awareness of the Racal Acoustics brand, globally. This website launch is a key step in extending brand awareness for Racal Acoustics whose specialist audio communications and protection systems are regarded globally as the finest on offer. Racal’s range of headsets and supporting products and services have been used by global forces consistently since the 1950’s. Today, they still offer the very best technology to provide effective communication, hearing protection and situational awareness across the tri-service battlefield.
Alexandre Huart, Vice President – Sales and Marketing at Racal Acoustics said: “launching our new website is a proud moment for our entire team as we continue our journey of solidifying the Racal Acoustics name across the global marketplace”. He added: “having led the build of our new website over the last four months, we’re very pleased to extend our initial contract with Chamois to include their wider PR and advertising services. Together, we’ll be working hard to improve our brand awareness, our profile and our sales”.
Jamie Clarke, CEO at Chamois said: “signing this new contract is great news for the team here at Chamois. Adding Racal Acoustics to our already strong portfolio further underlines what we have to offer our clients here at Chamois and we’re very much looking forward to continuing our journey together with Racal Acoustics”. He added: “prior to signing the PR and advertising contract with Racal Acoustics, we worked together with one of our partner agencies to design and build the new website. We’re all very pleased with what’s now live and can be seen by everyone. Please do take a look around the new site”.
13 Oct 20. Houlihan Lokey announced that Integration Innovation Inc. (i3) has agreed to sell its hypersonics business to Lockheed Martin Corp.
Headquartered in Huntsville, Alabama, i3 is a highly specialized provider of advanced engineering and technology solutions that enhance critical national security mission capabilities. The company provides a vast array of innovative engineering and production capabilities in high-priority domains, including hypersonics, C5ISR, cyber, electronic warfare, directed energy, missile defense, and unmanned systems. i3’s hypersonics business is a recognized expert in advancing and developing hypersonic weapons and supports many hypersonic strike and defense programs currently funded across the U.S. Department of Defense. In addition to its design, development, production, and integration capabilities, the company also provides highly specialized ground, launch, flight, and post-flight testing, evaluation, modeling, and simulation services.
Houlihan Lokey served as the exclusive financial advisor to i3. This transaction underscores the strong resilience of the defense and government industry and demonstrates the strong market for companies exhibiting differentiated capabilities in highly prioritized domains, solutions-oriented deliverables, and strategic customers and geographies.
Houlihan Lokey’s Aerospace, Defense & Government (ADG) practice within the global Industrials Group is the leading M&A advisor to aerospace, defense, and government services companies in the United States. Since the beginning of 2019, the ADG practice has closed more than 30 transactions worth more than $7bn in enterprise value. With a staff of approximately 30 investment bankers in Washington, D.C., London, and Los Angeles, Houlihan Lokey’s ADG practice is among the largest dedicated industry banking groups worldwide. In 2019, the Industrials Group was once again ranked as the No. 1 M&A advisor for all U.S. industrial transactions, according to Refinitiv (formerly known as Thomson Reuters).
12 Oct 20. Broadtree Partners Acquires Seanair Machine Co. Inc.. Partners with AE Industrial Partners to Acquire Long-Time Manufacturer of Aerospace Parts. Broadtree Partners LLC (“Broadtree”), a lower-middle market private equity firm, announced today that it has acquired Seanair Machine Co. Inc, (“Seanair” or the “Company,”) a family-run, 63-year-old manufacturer of OEM precision machined parts for the aerospace industry. The acquisition was completed in strategic partnership with AE Industrial Partners Structured Solutions I, LP and supported by Live Oak Bank (“LOB”). AE Industrial Partners Structured Solutions I, LP is an affiliate of AE Industrial Partners, LP (“AEI”), a private equity firm specializing in Aerospace, Defense & Government Services, Power Generation, and Specialty Industrial markets.
Founded in 1957, Seanair has a strong history of innovation, producing high-quality precision parts for the aerospace industry. The Company produces structural parts, flight controls, material handling, ground support, fuel systems, landing gears, wing structure parts, removable panels, and weapon-delivery components. Seanair’s long body of work includes the A-6 Intruder, EA-6B Prowler, E-2C Hawkeye, C-2A Greyhound, F-14 Tomcat, the Lunar Module, C-130 Hercules, F-16 Viper, F22 Raptor, U2 Dragon Lady, SH-60 Sea Hawk, V-22 Osprey and several classified programs. Based in Farmingdale, New York, the Company produces high-quality components in support of operational readiness and force projection of the US Armed Forces and their allies throughout the world.
Avi Das, who previously led Strategy & Corporate Development for Tata Group, has been appointed CEO of the Company, which will be rebranded as Seanair, LLC. Current owners Laura Abel Nawrocki and Thomas Nawrocki will continue to support Seanair’s high-quality operations and provide meaningful leadership and guidance in the growth of the new company as outside consultants.
“Broadtree is excited to continue the Seanair legacy. The Nawrockis have created an impressive company, and we look forward to building on a strong foundation,” said Johannes Zwick, Managing Partner at Broadtree. “We’re also happy to partner with AEI to further accelerate growth and continue to drive excellence in manufacturing and customer service.”
“Seanair is a great company with an inspiring history and an exciting future,” said Mr. Das of Seanair. “I look forward to working closely with Laura, Tom, the entire Seanair family and AEI, our strategic partner. Together, we are well positioned to usher in a new era of excellence and growth in this hidden gem.”
“We are proud of Seanair and its accomplishments. We are looking forward to seeing it soar and achieve great success under Avi’s leadership,” said Laura and Tom Nawrocki, the current owners.
“AEI is proud to partner with Seanair, a family-owned business that has both an established track record as well as a reputation for excellence in our target markets,” said Kirk Konert, Partner at AEI. “With the backing of an impressive group, including Tom, Laura, Avi and the Broadtree team, we are confident that the Company will have the resources to achieve its next stages of growth.”
Moore & VanAllen served as legal advisor to Broadtree and Kirkland & Ellis served as legal advisor to AEI. Mr. Kenneth S. Magida, ESQ served as the legal advisor to Seanair.
About Broadtree Partners
Broadtree Partners, headquartered in Charlotte, North Carolina, is a lower-middle market PE firm with an operator-centric model. Broadtree’s unique executive-in-residence approach allows owners to either smoothly exit their companies and seamlessly change leadership while preserving their legacy; or to bring operational and financial resources to a founder-led team to further accelerate growth. Broadtree’s team of operators and entrepreneurs work very closely with owners throughout the transaction process and transition to running the day-to-day operations after an acquisition. Broadtree seeks to partner with business owners and entrepreneurs to provide operational resources and institutional capital to transform and grow founder-owned businesses in the lower-middle market. Broadtree’s goal is to fuel stable, long-term growth while preserving the company’s core values.
Learn more at www.broadtreepartners.com
About AE Industrial Partners
AE Industrial Partners is a private equity firm specializing in Aerospace, Defense & Government Services, Power Generation, and Specialty Industrial markets. AE Industrial Partners invests in market-leading companies that can benefit from its deep industry knowledge, operating experience, and relationships throughout its target markets. (Source: PR Newswire)
13 Oct 20. DA-Group Enhances Operations to Serve its Defence and Aerospace Customers. Finnish technology corporation DA-Group combines its defence and space business units into one,
DA Defence & Aerospace. This operational change is one step forward in strengthening the company’s growth strategy.
The new unit will serve DA-Group’s defence and space customers as well as collaboration network more efficiently as all special application design, manufacturing and testing services are under the same roof.
Mr. Kristian Tornivaara is appointed as the Chief Business Officer, Defence & Aerospace. Mr. Tornivaara reports to Sami Kotiniemi, CEO. Mr. Tornivaara is a co-founder of one of the defence subsidiaries of DA-Group and has extensive experience in defence business management. Mr. Juuso Kaitalo is appointed as the Chief Product Officer to lead a new DA Products & Technologies unit and reports to the CEO. This unit takes responsibility of research, development, technology and product management activities on a corporate level. Mr. Kaitalo will remain in close co-operation with the DA Defence & Aerospace unit. Mr. Nestori Fabritius is appointed as the Business Development Manager, Defence & Aerospace.
Kristian Tornivaara is confident about positive effects the new business unit arrangement will bring. “Thanks to the combined synergies of the dynamic and innovative teams, we are able to enhance the capabilities and capacity of our already first class technology offering. Our objective is to excel in serving our customers and end-users. DA-Group is continuously developing more demanding products and comprehensive systems, especially in the fields of electronic and underwater warfare, and space situational awareness. We will bring our vast experience from development programs and delivery projects over the decades to the success of all the parties. I am convinced that our customers value the advance we provide giving them the superiority in their operation”, states Tornivaara.
All project contact information remain unchanged, unless otherwise directly informed. For more information, please contact Mr. Tornivaara, firstname.lastname@example.org.
11 Oct 20. Richard Branson’s Virgin Orbit seeks $1bn valuation in funding round: WSJ.-launch business Virgin Orbit is looking to raise up to $200m in a funding round that could value it at around $1bn, The Wall Street Journal reported on Sunday, citing people familiar with the matter.
Branson’s space ventures compete with those of fellow billionaires Elon Musk and Jeff Bezos in the commercially led space exploration industry.
Virgin Orbit said in August it had hired LionTree Advisors LLC and Perella Weinberg Partners LP to look at potential financial transactions. Those banks are helping it raise between $150m to $200m by as early as the end of the year for capital expenditure and to fund satellite launches, the Journal said. Virgin Orbit did not immediately respond to a request for comment on the report. (Source: Reuters)
07 Oct 20. Momentus’ Monumental Merger of Estimated $1.2bn to Become Public with Stable Road Acquisition Corp. News of this merger includes a number of ‘firsts’ in the space industry both in the combined estimated enterprise value of approximately $1.2bn, and the first publicly traded space infrastructure company. The companies Momentus Inc. (“Momentus” or the “Company”), a commercial space company offering in-space transportation and infrastructure services, today announced it has signed a definitive merger agreement with Stable Road Acquisition Corp. (Nasdaq: SRAC, SRACU, SRACW) (“Stable Road”) that will result in the Company becoming publicly listed. Upon the closing of the transaction, the combined operating company will be named Momentus Inc. and its securities will be listed on Nasdaq and trade under the ticker symbol “MNTS.”
The announcement released by Momentus reads as follows:
The current size of the global space economy is expected to grow from an estimated $415bn to $1.4trn by 2030 driving demand for transportation and infrastructure services in space. With the significant market opportunity in the new space economy, Momentus is well-positioned to address the need for in-space transportation and infrastructure services. Utilizing a multi-pronged approach, Momentus is developing capabilities to provide critical infrastructure services: in-space transportation, satellite as a service, and in-orbit services.
The Company has strong momentum from the rapidly expanding small satellite market, which is seeking low-cost and regular launch access to orbit. Momentus’ customers include satellite operators, satellite manufacturers, launch providers, defense primes such as Lockheed Martin and government agencies such as NASA. As of September 30, 2020, the Company had customer contracts which represent approximately $90m in potential revenue over the next several years.
Momentus is creating the first hub and spoke model in space by offering last-mile delivery in partnership with key launch operators, including SpaceX. Momentus offers its customers significantly more affordable access to space by combining the capabilities of low-cost launch vehicles and Momentus’ transport and service vehicles, powered by water plasma propulsion technology. Momentus plans to expand its offerings by providing a satellite as a service model for hosted payloads and an in-orbit service model for satellite deorbiting, life extension, refueling, and repositioning. In 2019, the Company successfully tested its water plasma propulsion technology in space.
Momentus has developed its first transport and service vehicle, Vigoride, to serve the needs of customers in Low Earth Orbit by delivering small satellites up to 750kg to precise destinations, and expects to provide hosted payload services, and in-orbit services. The Company plans to launch its first Vigoride vehicle in December 2020 with commercial customers and four to five Vigorides in 2021. The Company is developing two larger, more capable vehicles in its development plans: Ardoride in 2022 and Fervoride in 2024 with the goal of serving all orbits up to Geosynchronous Orbit and even Lunar Orbit and handling payloads of up to 4,000 kg. To extend the capabilities of gigantic rockets like SpaceX’s Starship and Blue Origin’s New Glenn, the Company is building its largest vehicle to date – Fervoride, which the Company expects to be capable of delivering up to 20 tons of cargo anywhere from Low Earth Orbit to Geosynchronous Orbit and into deep space. Fervoride is expected to be a pathfinder for the prospecting and use of space resources such as water from the Moon and asteroids and a technology enabler for the largest moonshot opportunities like solar energy generation in space.
“Momentus is at the forefront of the new space economy and is poised to capitalize on the significant growth opportunity as a first mover; we believe in a future where humanity is equipped with all it needs to flourish throughout the solar system,” said Mikhail Kokorich, Founder and Chief Executive Officer of Momentus. “Our mission is to provide the infrastructure services that support all industry beyond Earth. The technologies we’ve developed or built upon, including our groundbreaking water plasma propulsion, will support growing demand from the booming satellite industry with affordable, versatile and low risk transportation and infrastructure services across private companies, government agencies, and research organizations. We expect to deploy the proceeds of this transaction to support our rapid growth and operations, and to support our capital needs as we ramp up revenues. We are excited to partner with the Stable Road team and look forward to leveraging their capital markets expertise.”
Brian Kabot, Chairman and Chief Executive Officer of Stable Road added, “We set out to identify a disruptive company and Momentus was the most unique and compelling opportunity to create value through our investment, as we believe the Company is primed to be a leader in the rapidly growing new space economy. As the only public, pure-play commercial space company capable of revolutionizing space infrastructure, Momentus is poised to capitalize on its market-defining position. We are excited to partner with Momentus as the Company develops its technology portfolio, continues to leverage deep customer relationships across diverse private and public sector applications, and expands its experienced leadership team.”
Pursuant to the transaction, Stable Road, which currently holds approximately $172.5m of cash in trust, will combine with Momentus, which is estimated to result in a pro forma enterprise value of approximately $1.2bn. Momentus’ existing equity security holders will hold approximately 75% of the issued and outstanding shares of Class A common stock immediately following the consummation of the merger, assuming no redemptions by Stable Road’s existing public stockholders.
Cash proceeds in connection with the transaction will be funded through a combination of Stable Road’s cash in trust and through a $175.0m fully committed common stock PIPE at $10.00 per share, including investments from private equity growth investors, family offices and select top tier public institutional investors.
The boards of directors of both Momentus and Stable Road have unanimously approved the proposed transaction. Completion of the proposed transaction is subject to approval of Stable Road and Momentus stockholders and other closing conditions, including a registration statement being declared effective by the Securities and Exchange Commission, and is expected to be completed in early 2021.
Additional information about the proposed transaction, including a copy of the merger agreement and investor presentation, will be provided in a Current Report on Form 8-K to be filed by Stable Road with the Securities and Exchange Commission (“SEC”) and available at www.sec.gov and on Momentus’ website at www.momentus.space. Stable Road will file a registration statement (which will contain a proxy statement/prospectus) with the SEC in connection with the transaction.
Evercore is serving as the exclusive financial advisor and capital markets advisor to Momentus. Cantor Fitzgerald & Co. is serving as capital markets advisor to Stable Road. Orrick, Herrington & Sutcliffe LLP is serving as legal advisor to Momentus, and Kirkland & Ellis LLP is serving as legal advisor to Stable Road. ICR is serving as investor relations and communications advisor to Momentus.
As a first mover in building in-space transportation and infrastructure technology, Momentus is at the forefront of the commercialization of space. With an experienced team of aerospace, propulsion, and robotics engineers, Momentus has developed a cost-effective and energy efficient in-space transport system based on water plasma propulsion technology. Momentus has in-place service agreements with private satellite companies, government agencies, and research organizations, and its first Vigoride™ transport and service vehicle launch is scheduled for December 2020.
About Stable Road Acquisition Corp
Stable Road Acquisition Corp. (Nasdaq: SRAC, SRACW, SRACU) is a special purpose acquisition company formed by SRC-NI Holdings, LLC, an affiliate of Stable Road Capital, for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination.
Forward-looking statements included in this press release speak only as of the date of this press release. Except as required by law, neither Stable Road nor Momentus undertakes any obligation to update or revise its forward-looking statements to reflect events or circumstances after the date of this release. Additional risks and uncertainties are identified and discussed in the Stable Road’s reports filed with the SEC and available at the SEC’s website at www.sec.gov. (Source: Satnews)
TCI International, Inc., is a wholly-owned subsidiary of SPX Corporation. TCI provides turn-key solutions for spectrum management and monitoring, direction finding, geolocation and communications intelligence to civilian, government, military and intelligence agencies as well as antennas for communications and high-power radio broadcasting. TCI is headquartered in Fremont, California, USA. For more information, visit www.tcibr.com.