Was 2021’s record $15.4 billion investment in the space industry the peak or merely a step toward another monumental year?
Transactions since the beginning of 2022 point to trends that are both positive and negative for the market, such as the increased importance of debt as part of a fundraise, the changing prospects of special purpose acquisition companies (SPACs) and the coming integration of satellite and terrestrial networks. For more information on the following investments and mergers and acquisitions (M&A), visit our Mandates database:
Debt
- Synspective raises $97M
Tokyo-based synthetic aperture radar constellation builder Synspective expects to have six satellites in orbit by the end of 2023. The company — one of several in the industry building factories — is constructing a new facility for its “100 kg class” satellites. Its March fundraise consisted of a loan of approximately $18.9 million from two banks, with 16 investors providing the remaining funds. Early use cases include disaster monitoring and land displacement tracking for large construction projects, CEO and co-founder Motoyuki Arai told Connectivity Business News.
- Everstream secures more than $1B in debt financing
Enterprise fiber provider Everstream, majority-owned by Australia-based global investment manager AMP Capital, raised more than $1 billion in debt financing using a model that is “pretty common in Europe but it’s new to the U.S.,” CEO Brett Lindsey told Connectivity Business News. The round was led by France-based bank Societe Generale with a junior tranche of $220 million in the form of a holding company term loan provided by DigitalBridge’s (NYSE: DBRG) Digital Credit division in partnership with Canada Pension Plan Investment Board subsidiary CPPIB Investments III. Banks “treat the [holding company loan] as equity [allowing] us to continue to fund the business without taking additional equity,” Lindsey added.
SPACs
- D-Orbit to SPAC at $1.3B valuation
The SPAC trend is declining, with fewer such transactions expected this year, but Italy-based in-orbit services provider D-Orbit plans to close its combination with Breeze Holdings Acquisition Corp. (NASDAQ:BREZ) in Q3, according to its most recent SEC filing dated April 14, 2022. The company had originally planned to close the transaction in Q2 or Q3. The deal includes a $29 million — net after costs — convertible note financed by New York City-based investment manager ATW Partners.
- Satellogic SPAC raises $265M with participation from Mnuchin
Earth imaging company Satellogic (NASDAQ: SATL) completed its de-SPAC transaction with funding from Washington, D.C.-based Liberty Strategic Capital, founded by former U.S. Secretary of the Treasury Steven Mnuchin. Liberty Strategic Capital obtained 20 million shares of Satellogic at $7.50 per share as well as 5 million warrants with a strike price of $10 per share and 15 million warrants with a strike price of $15 per share — all at a price of $150 million — essentially obtaining the warrants for free. The warrants expire five years after issuance. Satellogic opened this morning at $8.19.
Satellite-terrestrial network integration
- Mangata Networks raises $33M for multi-orbit constellation serving edge micro data centers
Perhaps demonstrating the power of satellite-terrestrial network integration, Phoenix-based Mangata Networks raised $33 million in its series A funding round in January. Edge spending is predicted to increase to $176 billion in 2022, a 15% year-over-year increase, according to International Data Corporation’s (IDC) Worldwide Edge Spending Guide, also released in January. The company will move on to a series B funding round, and given an oversubscribed series A and significant interest, CEO Brian Holz told Connectivity Business News that he expects to raise at least $99 million.
An unusual transaction allows an early investor to cash out
- Cologix recapitalizes with Stonepeak in deal valued at $3B
Infrastructure investor Stonepeak’s Stonepeak Infrastructure Fund II and co-investors — including Mubadala Investment Company, the sovereign investor of Abu Dhabi — sold interconnection-focused edge data center provider Cologix to a combination of Stonepeak Infrastructure Fund II investors and new investors. The sale allowed some early investors to cash out, including Mubadala Investment Company.
