Small launch company Astra announced February 2 that it is in the process of becoming the first launch company to be listed. The company is expected to be valued at around $2.1 billion.
Astra’s listing on the Nasdaq will follow the completion of a merger with a special purpose acquisition company (SPAC) called Holicity Inc. SPACs, or blank check companies, are companies that offer no commercial operations and are formed with the primary goal of raising capital through an initial public offering (IPO). This capital is then utilized to purchase an existing company, in this case, Astra.
Holicity was formed in 2012 by elusive billionaire Craig McCaw. During its IPO, the company raised $275 million. Prior to its IPO, McCaw had stated that it would initially focus its search for a prospective target business in the technology, media, and telecommunications industries. It is unclear if an approach was made prior to Astra’s December 2020 success, or if the company’s first mission to reach orbit caught McCaw’s attention.
In a February 2 announcement detailing the particulars of the agreement, Astra revealed that the transaction is expected to provide $500 million in capital, $300 million of which is held in a Holicity trust account. The rest will be raised with a $200 private investment in public equity (PIPE) approach. A PIPE approach offers shares in a new company below the market rate to investment firms, mutual funds, and other large investors.
In addition to the capital investment, Astra has already secured customers for over 50 launches. Customers that have signed on to launch aboard Astra flights include NASA and the Department of Defence. The company expects its current 50-launch manifest to net over $150 million in launch revenue.
With the completion of its first successful orbital launch in December, Astra expects to launch its first operational mission this summer and to begin monthly launches by the end of the year. This launch cadence will then be ramped up over the next four years to a point where Astra expects to be able to launch daily.
The boards of directors of both Astra and Holicity have approved the merger. The agreement is now subjected to approval by Holicity stockholders. Once complete, the combined company will be called Astra and will be listed on the Nasdaq under the symbol “ASTR.”