Weather satellite services startup GeoMetWatch landed a breakthrough deal this past spring, securing an agreement from AsiaSat to host GeoMetWatch’s infrared sounding instrument on the AsiaSat 9 telecommunications satellite slated to launch in 2016.
The complicated arrangement calls for Hong Kong-based AsiaSat to fund, to the tune of $185 million, the cost of the GeoMetWatch STORM sensor and its integration on the satellite, to be placed in geostationary orbit at 122 degrees east longitude. In exchange, GeoMetWatch must issue a convertible note to AsiaSat, the amount of which is subject to negotiation between the companies. AsiaSat also would share in the revenue generated by the sensor, data from which would be sold to regional weather forecasters.
GeoMetWatch touted the deal as the first of several that would see it deploy a global network of six Sounding and Tracking Observatory for Regional Meteorology (STORM) instruments, all based on a design the company obtained from a U.S. government program that was abandoned after an investment of more than $400 million. The hyperspectral sounders would, among other things, improve predictions of severe storms, even in the United States, which operates some of the world’s most sophisticated weather satellites.
But the July 31 deadline for finalizing the terms of the arrangement came and went, with the companies still at the negotiating table.
In an Aug. 22 filing with the Hong Kong Stock Exchange, AsiaSat cited “a number of technical and commercial challenges” to arranging the financing, but nonetheless expressed optimism about the partnership’s potential.
GeoMetWatch, too, remains optimistic. In a Nov. 6 email exchange, GeoMetWatch Chairman William Readdy said the company believes it is getting closer to a final agreement with AsiaSat. He cautioned, however, that once final terms are reached, financing from the U.S. Export-Import Bank could be delayed as agency works off the backlog created by the recent U.S. government shutdown.
Readdy said the coming year looks to be a busy one as the GeoMetWatch continues discussions with prospective government and commercial customers, investors and partners. “Several of those relationships look very promising,” he said.
AsiaSat, meanwhile, has yet to select a manufacturer for AsiaSat 9, but to meet a 2016 launch date that contract needs to be awarded in 2014. Because of the requirements for hosting the STORM sensor, which weighs about 300 kilograms and consumes 500 watts of power, AsiaSat likely will need to resolve the GeoMetWatch question one way or another before awarding the contract.
Losing the AsiaSat deal wouldn’t by itself sink GeoMetWatch, but it would cost the company crucial momentum, making an already challenging climb just a bit steeper.
