Satellogic satellites
The completion of the SPAC merger gives Satellogic the finances needed to build a constellation of more than 200 imaging satellites by 2025. Credit: Satellogic

WASHINGTON — Earth observation company Satellogic will start trading as a public company Jan. 26 after completing a delayed merger with a special purpose acquisition company (SPAC).

Satellogic announced Jan. 25 it closed its merger with CF Acquisition Corp. V, a SPAC affiliated with financial firm Cantor Fitzgerald. That came a day after shareholders of the SPAC voted to approve the deal. Satellogic will start trading on the Nasdaq exchange Jan. 26 under the ticker symbol SATL.

The merger will provide $262 million in gross proceeds to Satellogic, supporting the development of a satellite constellation that will provide high-resolution and hyperspectral imagery updated daily. That includes an investment of $150 million from Liberty Strategic Capital, a fund established by former Treasury Secretary Steven Mnuchin, announced Jan. 18.

Satellogic and CF Acquisition Corp. V postponed the shareholder vote three times in December while it worked to line up the additional financing. “We wanted to get that transaction closed before the merger, and that took a little bit more time than we had planned,” Emiliano Kargieman, chief executive of Satellogic, said in an interview.

Mnuchin will serve as the nonexecutive chairman of Satellogic. “We see a lot of synergies between what Liberty Strategic Capital and Secretary Mnuchin can bring to the table for us and our strategy going forward,” Kargieman said, such as how to use the company’s imagery for government applications. “We’re really excited to have Secretary Mnuchin support us.”

“We look forward to partnering with you as you focus on a growing market with tremendous commercial and government opportunity,” Mnuchin said in a statement. “Access to high-quality and cost-effective information will improve decision-making and help solve problems on a global scale.”

The additional investment became necessary to ensure Satellogic had the capital needed to develop its satellite constellation. When it announced the SPAC deal in July, it expected to raise $271 million through the proceeds of the SPAC itself as well as a $100 million private investment in public equity, or PIPE, round.

However, SPAC mergers in recent months have suffered a high rate of redemptions, where shareholders of the SPAC get their money back rather that retain shares in the merged company. According to a U.S. Securities and Exchange Commission filing, holders of 23.1 million shares of CF Acquisition Corp. V, out of 31.85 million outstanding shares, elected to redeem those shares.

Kargieman said the funding raised in the restructured merger will fully fund development of its constellation, although the size of that constellation has changed. While Satellogic once projected launching 300 satellites by 2025 to provide daily global remapping, the company revised its forecast when announcing the Liberty Strategic investment to having 202 satellites in orbit by 2025.

That smaller constellation will still meet that goal of remapping the globe daily. “We factored into our plans, as we updated our guidance, that we improved the efficiency of the satellites,” he said, with each satellite now able to cover more area, and thus requiring fewer satellites. “Slightly more than 200 satellites will still allow us to do daily remaps of the entire planet by 2025. We’re taking advantage of the fact that we’ve updated the design and the capacity of the satellites.”

Those revised projects also reduced the company’s revenue forecast from $787 million to $480 million in 2025, with adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) also decreasing from $473 million to $297 million in 2025. Kargieman said those reduced forecasts are caused by both a delay in closing the merger as well as “taking a more conservative view” on projected growth.

With the merger completed, Kargieman said he’s turning his attention to developing the satellite system. “There’s nothing that excites me more than being able to put our heads down and focus on executing our plan,” he said, with plans to launch more than 50 satellites this year, starting with five in April. The company is building a new factory in the Netherlands for high-throughput production of satellites that should be operating at “full speed” by the third quarter.

The company is looking to expand its engineering, sales and customer support personnel as it builds out the constellation. The company has a little more than 320 employees worldwide, and Kargieman said he expected that to double in the next 18 months.

Jeff Foust writes about space policy, commercial space, and related topics for SpaceNews. He earned a Ph.D. in planetary sciences from the Massachusetts Institute of Technology and a bachelor’s degree with honors in geophysics and planetary science...