After months of negotiations, three European aerospace companies have announced an initial agreement to merge their loss-making satellite manufacturing divisions. The aim is to join forces to counter Elon Musk's main competitor, Starlink. The plan is to create a new joint venture.
After months of negotiations, three European aerospace companies have announced an initial agreement to merge their loss-making satellite manufacturing divisions, aiming to join forces to counter Elon Musk's main competitor, Starlink, and create a new joint venture.
This long-awaited agreement between Airbus , Thales and Leonardo aims to create a new joint venture that will start operating from 2027, subject to approval by European regulators, who have previously resisted such mergers, writes Reuters.
The new, as yet unnamed, company will have 25,000 employees across Europe and annual revenue of 6.5 billion euros ($7.58 billion) by 2024, the companies said in a joint statement.
Airbus will own 35% of the shares, while Thales and Leonardo will each own 32.5%. The new company will operate under joint control “with a balanced management structure.”
Leading European satellite manufacturers have long competed in building complex spacecraft in geostationary orbit, but have suffered from the emergence of cheap tiny satellites in low Earth orbit.
The CEOs of the three companies said in a joint statement that the merger would help governments ensure "Europe's autonomy in the strategic space domain."
This agreement involves the combination of the manufacturing and service activities of Thales Alenia Space and Telespazio (joint ventures of Leonardo and Thales), as well as a number of Airbus space and digital divisions, the remaining space activities owned by Leonardo, and Thales SESO.
Talks between the three aerospace groups, codenamed Project Bromo, began last year in an attempt to copy the collaboration model of European missile maker MBDA, which is owned by Airbus, Leonardo and BAE Systems (BAES.L).
