Updated Jan. 14, 2019, with the correct acquisition date for Miltec. 

WASHINGTON — British small satellite manufacturer Surrey Satellite Technology Limited (SSTL) is selling off its U.S. factory to General Atomics, a defense contractor with a growing interest in building military-optimized spacecraft.

SSTL and General Atomics announced in separate statements Nov. 13 that the facility and accompanying workforce at SST-US’s Englewood, Colorado location will become part of the San Diego, California company’s Electromagnetic Systems Group (GA-EMS). Neither company disclosed the financial terms of the transaction.

The changing of hands provides SSTL a means to divest from an asset that didn’t capture U.S. smallsat business the way the company had envisioned when establishing the subsidiary in 2008. Sarah Parker, SSTL’s managing director, told SpaceNews in June that the company would be giving up the Colorado factory, seeking “a different organizational set up” to gain American smallsat customers.

General Atomics, a newcomer to satellite manufacturing, has been scaling its production of smallsats, having acquired Huntsville, Alabama-based Miltec last February. Nick Bucci, vice president of missile defense and space systems for General Atomic’s Electromagnetic Systems Group, told SpaceNews last month that the company is building 3U and soon 6U cubesats weighing just several kilograms, but wanted to build spacecraft weighing as much as 500 kilograms. Owning SST-US’s factory provides that capability.

General Atomics told SpaceNews Nov. 13 that the facility adds 13,000 square feet of manufacturing space, but did not respond to other inquiries about the transaction, such as which SST US programs General Atomics will continue. SSTL, in announcing the sale, said GA-EMS will take over SST-US’s ongoing projects. 

“The Surrey-US team’s expertise in designing and deploying small satellites and end-to-end mission solutions is complementary to ours,” Scott Forney, GA-EMS president, said in a Nov. 13 statement. “We are excited that GA-EMS now will offer ground-to-space solutions utilizing nano, micro and small satellites from 3U to 500 kg with a high degree of modularity and payload flexibility.”

General Atomics does not focus on the commercial smallsat market, choosing instead to build spacecraft with more stringent requirements for defense customers. The company has built 11 cubesats for the U.S. Army to date.

General Atomics is also considering a railgun launch system that would use electromagnetic force to fire smallsats into orbit.

In the company’s statement, SSTL signaled lingering interest in the U.S. market, saying the deal allows the two companies “to explore more effectively possible future opportunities in the US governmental and commercial markets.”

“SSTL is pleased that the agreement with GA secures the employment of SST-US employees and believes that it offers the best opportunity to build on the latent potential for SSTL’s small satellite solutions in the US,” the company said.

Parker in October said SSTL would seek to outsource a greater fraction of satellite manufacturing work going forward, rather than hiring and shedding employees based on new and completed contracts.

Caleb Henry is a former SpaceNews staff writer covering satellites, telecom and launch. He previously worked for Via Satellite and NewSpace Global.He earned a bachelor’s degree in political science along with a minor in astronomy from...