Another Space SPAC Is Coming: Astra

Virgin Galactic (NYSE: SPCE).

Stable Road Acquisition's (NASDAQ: SRAC) Momentus.

New Providence Acquisition's (NASDAQ: NPA) AST SpaceMobile.

And soon, space investors will have a fourth pure play "space company" to choose from when special purpose acquisition company (SPAC) Holicity (NASDAQ: HOL) brings small rocket launcher Astra public in a SPAC-sponsored, reverse-merger IPO.

Astra rocket launching from Kodiak, Alaska.

Image source: Astra.

Holicity announced the news on Tuesday, saying it has reached a "definitive agreement" to acquire Astra and bring the start-up space-launch provider public in the second quarter of 2021 with "an implied pro forma enterprise value ... of approximately $2.1 billion."

Astra conducted a mostly successful space launch in December when its Rocket 3.2 launch vehicle launched from the Pacific Spaceport Complex in Kodiak, Alaska. The test flight was Astra's third attempt, preceded by one rocket that failed before launch in March (during a fueling test) and a second that was terminated after launch in September when it drifted off course. The third time was (almost) the charm, however, as December's test flight successfully reached its target altitude of 236 miles (380 kilometers), just failing to reach orbital velocity and therefore falling back out of orbit.

Astra is already working on its next launch and "identifying ... how to further improve the vehicle performance." The company says it has 50 launches already reserved by future customers, worth $150 million in future revenue.

Merging with Holicity will provide Astra additional funds to finance the company's efforts to become a reliable provider of space-launch services for small satellites. In Tuesday's press release, Holicity stated that between cash it raised in its own IPO and the $200 million it expects to raise from a private investment in public equity (PIPE) transaction, Astra should emerge onto the public markets with $500 million in the bank.

Astra plans to list on the Nasdaq under the ticker symbol ASTR.

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Rich Smith owns shares of Stable Road Acquisition. The Motley Fool owns shares of and recommends Virgin Galactic Holdings Inc. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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