Amid $5 billion buyout, Cobham in hot pursuit of megaconstellation work
Cobham accepted a U.S. private equity group’s $5 billion offer July 25 to take the British defense and aerospace contractor private. The buyout comes as Cobham’s Advanced Electronic Solutions group, which derives 25% of its revenue from space and counts OneWeb as a customer for approximately 40,000 waveguides (shown above), is gearing up to support more broadband constellations.
SpaceNews spoke with Cobham Advanced Electronic Solutions President Shawn Black, a Leonardo DRS veteran promoted last month from chief operating officer, to find out what’s in store for CAES’s spacecraft component business and where it sees itself in the growing small satellite market.
How do volume requirements of megaconstellations impact your business?
We’ve invested in capital equipment to be able to handle the volume of OneWeb and constellations like OneWeb, and to be able to handle more than one at a time. We have several factories around the United States that can offload the burden depending on what happens with the market.
We do have the capacity, and there’s alternate manufacturing techniques for the technologies we’re providing that allow us to scale faster and deal with the volumes. We’re investing in new ways to manufacture.
Geostationary satellite orders seem to be doing a little better this year. Do you have more hope in those, or in broadband megaconstellations?
We want to balance both, but we think this may be the time that Space 2.0, or NewSpace, takes off. It’s still in its infancy and there have been starts and stops in the past, but I think one of the differences this time is there’s lots of big private money going into the market. Not everyone will survive, but we’ve prepared early. OneWeb is obviously a big deal for us, as are the others we’re pursuing. We are betting that this goes, but we don’t want to do anything that would disrupt our traditional customer set.
One of Cobham’s goals is to make CAES more profitable, like its other divisions. What is your strategy to do that?
It’s defining an operational framework. Some of the tenets of that strategy involve putting bids together with more thorough due diligence based on estimates, and identifying risks and fully understanding all the requirements we’re being asked to address with our bid.
Another is associated with operational improvements within manufacturing, sales, operations planning, and how we work to meet on-time delivery. CAES has been very good with quality. That’s a strong point. We don’t want to sacrifice quality. We are on a journey to improve on-time delivery. We’ve made improvements and we want to continue to do that, and it’s through focusing on these areas: how we execute contracts, how we do planning, continuous improvement initiatives, all those types of things.
Where is CAES investing its R&D funding?
Our focus has been primarily around SWAP-C improvements — space, weight, power and cost — to enable that market. We are leveraging our packaging capabilities and our Gallium Nitride processing technologies into our architecture. The need for higher data rates is driving a need for higher frequencies, and we’re focused on the technologies that support those things. There are several things associated with engineering and manufacturing that are going to enable us to support the megaconstellation market.