Rocket Lab's planned acquisition of Mynaric, a German optical communications supplier, is a pivotal move in its broader strategy. The acquisition, discussed in an May 8 earnings call, is progressing well, with a targeted closure later this year. The initial cost is $75 million, with potential for an additional $75 million based on revenue targets.
The deal hinges on Mynaric's completion of a restructuring process under German law. Rocket Lab's CFO, Adam Spice, acknowledged regulatory processes, including navigating a bankruptcy process, before the acquisition can be finalized. While the timeline remains uncertain, Spice noted that everything appears to be progressing as planned.
Mynaric's financial difficulties, stemming from laser terminal production issues, are seen by Rocket Lab as an opportunity. CEO Peter Beck highlighted Rocket Lab's production strengths, stating, “The biggest issue is just production, and that’s an area where we’re very, very strong in.” The acquisition provides Rocket Lab with its first European presence, opening doors to European government agencies.
Rocket Lab intends to continue offering Mynaric terminals to other companies, mirroring its approach to other acquired technologies. However, the technology is also crucial for Rocket Lab's vertical integration efforts, ensuring a “reliable, scaled supply of components for our own aspirations,” as Beck explained. This is particularly vital for large constellations, requiring high-speed, secure inter-spacecraft communication.
The company is actively pursuing various government and commercial contracts for building entire satellite constellations. While Rocket Lab aims to become a constellation owner and operator, details about its own constellation remain scarce. Andrew Chanin of ProcureAM acknowledges Rocket Lab's potential but notes the competitive landscape, suggesting that waiting for the Neutron rocket's launch and achieving profitability might be prudent before committing to a major constellation investment. Despite this, Chanin sees a niche for Rocket Lab, potentially attracting clients hesitant to work with dominant players like SpaceX.
Spice mentioned having "half a dozen deals in the pipeline" for further vertical integration, and Beck didn't rule out acquiring a satellite operator, stating, “We look at everything…much more needle-moving opportunities.”