Iridium Conducts Secondary Payload Competition
Iridium has several willing partners wanting to be secondary customers on its next-generation satellite constellation, CEO Matt Desch told investors Wednesday. “It is a race to see who gets the space. There is more interest in it than I will be able to accommodate. It is called a secondary payload for a reason. We are primarily a communications company.” The secondary payloads will weigh only 110 pounds while each craft will weigh nearly 1,800 pounds, Desch said. He expects there will only be one or two payload partners.
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Potential payload partners are paying Iridium to conduct studies, Desch said. “People are actually giving us money that is being used to evaluate their applications on our networks.” Proposals are coming from many sectors including the global scientific community and government agencies interested in climate change research, he said. “No one else has 66 satellites all over the planet all interconnected,” he said, saying this gives the opportunity for global monitoring.
Lockheed Martin and Thales Alenia Space are competing for the contract to build the 66-craft constellation known as IridiumNext. Iridium expects to award the fixed-price contract next year, Desch said. In the meantime, it “continues to work with each company separately,” he said.
Iridium’s proposed takeover by GHL Acquisition is on track, GHL CEO Scott Bock said. Approval should come in April or May, Bock said. Iridium said in September that it agreed to be bought by GHL in a deal valuing Iridium at $591 million (CD Sept 24 p5). GHL is a special-purpose acquisition company created in February by the Greenhill & Co. investment bank. Iridium called the deal a sponsored IPO. The transaction was cleared by the Department of Justice in October and the company filed the preliminary proxy statement with the SEC Monday, he said.
GHL must also get approval from at least 30 percent of its shareholders for the deal to go forward. GHL hasn’t begun lobbying for shareholder approval because it awaits SEC approval, Bock said.
Iridium subscribers grew 37 percent at the end of Q3, from the same time last year, the company said. The mobile satellite services operator now has 309,000 subscribers. Q3 revenue rose to $88.2 million from $74.2 million for the same period last year.