Fresh from signing a lucrative new contract with the National Geospatial-Intelligence Agency worth up to US$3.55bn, earth observation operator DigitalGlobe has contracted Ball Aerospace & Technologies and ITT Industries to build its next generation…
Fresh from signing a lucrative new contract with the National Geospatial-Intelligence Agency worth up to US$3.55bn, earth observation operator DigitalGlobe has contracted Ball Aerospace & Technologies and ITT Industries to build its next generation satellite, WorldView-3.
Ball will construct the satellite, while ITT will provide the imaging system. The two companies built DigitalGlobe’s three previous satellites, QuickBird, WorldView-1 and WorldView-2, which were launched in 2001, 2007, and 2009 respectively.
Both Ball and ITT own less than 5% of DigitalGlobe’s outstanding common stock.
The contract with Ball is worth approximately US$180.6m, subject to adjustment based on any failure by Ball to achieve specified delivery milestones. Ball is required to deliver WorldView-3 no later than May 2014, with the first payments due on October 1, 2010 and expected to extend into the third quarter of 2014. If Ball delivers the spacecraft earlier than the agreed date, DigitalGlobe is obliged to pay certain agreed incentive bonuses.
DigitalGlobe’s agreement with ITT is worth US$126.5m and requires the latter to deliver the imaging system for WorldView- 3 no later than July 2013. As with the Ball contract, payments are expected to begin from this October and will extend into the third quarter of 2013.
Following the NGA’s award in August of a new 10-year commercial satellite imagery purchase contract under its Enhanced View Program, DigitalGlobe stated that it would immediately begin the procurement of WorldView-3. Under that agreement, NGA has certain specified priority access rights to approximately 50% of Worldview’s existing constellation. This will increase to 60% once WorldView-3 is operational.
Commenting on the deal,ß DigitalGlobe’s chairman and CEO, Jill Smith, said: “Our business continues to undergo rapid growth as evidenced by recent contract awards. Coming on the heels of this important win, this is the absolute right time for development of our third next-generation satellite, which will satisfy growing demand from our government and commercial customers alike.” Interestingly, in an SEC filing on August 31, Smith notified DigitalGlobe that she has elected not to renew her employment agreement with the company, which is scheduled to expire on September 1, 2011. The board of directors has subsequently engaged an unnamed recruitment firm to find Ms Smith’s successor.
