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, a SPAC that went public in November 2020. The merger will provide Redwire with $170 million in capital, valuing the company at $615 million.
AE Industrial Partners, a private equity firm, created Redwire in June 2020 by combining two space technology companies, Adcole Space and Deep Space Systems, it had acquired. Redwire has since gone on to acquire several more companies, including in-space manufacturing company Made In Space, structures companies LoadPath and Roccor, engineering firm Oakman Aerospace and, most recently, Deployable Space Systems, a developer of spacecraft structures and solar arrays.
Those acquisitions have turned Redwire into a major supplier for the industry. “Redwire is supplying the picks and shovels that enable nearly every space mission,” Peter Cannito, chairman and chief executive of Redwire, said in a statement announcing the deal.
That business has made Redwire unique among space companies going public through SPACs in that it has both revenues and profits. The company reported $119 million in revenue in 2020, with adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $13 million. The company projects revenue to grow to $163 million in 2021, with adjusted EBITDA of $20 million.
In addition to the proceeds from the SPAC, Redwire said the deal includes a current investment, known as a public investment in private equity (PIPE) of $100 million, with participation by Senvest Management, LLC and Crescent Park Management, L.P. Many SPAC mergers include a PIPE as a means of providing additional capital.
Redwire said an investor presentation that the cash it raises from the deal will be “dry powder for strategic investments and continued pursuit of Redwire’s proprietary M&A [merger and acquisition] pipeline.”
“We also believe there is significant opportunity to accelerate growth through strategic combinations in the fragmented space landscape,” Paul Hobby, chief executive of Genesis Park, said in the statement announcing the deal. “Redwire has established itself as a first-mover consolidator and an acquirer of choice, and we believe its position will be further improved as a public company.”
Redwire says it will also pursue business opportunities in five “strategic focus areas,” including on-orbit servicing and assembly, low Earth orbit commercialization, digital engineering of spacecraft, space domain awareness and advanced sensors and components. Those areas leverage capabilities from the companies it has acquired, such as Made In Space for on-orbit assembly and Oakman Aerospace for digital spacecraft engineering.
Through growth in those strategic areas and future acquisitions, Redwire estimates that, by 2025, its revenues will increase to $1.4 billion with an adjusted EBITDA of $250 million.
Redwire joins a wave of companies in the space sector that have announced plans to go public through SPACs. Those have included in the last six months in-space transportation company Momentus, space communications company AST SpaceMobile, small launch vehicle companies Astra and Rocket Lab, imaging company Black Sky and satellite services company Spire. None of those deals have yet closed, but shareholders in New Providence Acquisition Corp., the SPAC that announced in December an agreement with AST SpaceMobile, are scheduled to vote to approve the merger April 1.