Redwire Will Go Public This Quarter Through SPAC Merger
Redwire has officially added its name to the list of space companies going public through a special-purpose acquisition corporation (SPAC). The space infrastructure conglomerate, which includes recently acquired entities such as Deployable Space Systems, LoadPath, Roccor, and Made in Space, announced March 25 that it will merge with Genesis Park Acquisition Corp.
Genesis Park is a publicly traded SPAC. The transaction will quickly transform Redwire into a publicly traded company when it is completed by the end of the 2021 second quarter. Genesis Park will change its name to Redwire and the company will trade on the New York Stock Exchange.
This transaction is the latest in a string of new space companies going public through a SPAC, which involves the formation of a shell company that goes public and then combines with an established company. Rocket Lab, Spire Global, BlackSky, Momentus, Astra, and AST SpaceMobile, have also recently announced plans to take this alternate route to an IPO. Rocket Lab CEO Peter Beck recently told Via Satellite that SPACs will allow space startups like his company to compete with publicly traded companies to make acquisitions and other deals.
While some of the other SPACs include valuations in the billions of dollars, Redwire said its merged company will be worth $615 million and that it will gain $170 million in additional capital through the transaction. The company is projecting 72% estimated revenue compound annual growth rate, from $163 million in 2021 to $1.4 billion in 2025. Redwire’s contract backlog currently stands at more than $150 million.
Organic growth during the next five years will be led by the commercial sector, accounting for more than $500 million in sales, followed by the national security sector, which will approach $500 million, and finally the civil sector with $202 million, Bill Read, Redwire’s chief financial officer, said during an investor presentation on Thursday.
Peter Cannito, Redwire’s chairman and CEO, said that the company’s financial strength and “rapidly growing contract backlog … gives us the confidence we will achieve our projections.”
Redwire is less than a year old. The company formed in June 2020 after aerospace private equity firm AE Industrial Partners (AEI) acquired spacecraft integrator Deep Space Systems (DSS). It acquired Made in Space less than a month later, followed by Roccor in October, LoadPath in December, and Deployable Space Systems in February.
Although a small company, Redwire has a rich heritage in space flight through the companies it acquired, having flown on more than 150 civilian, military and commercial satellite missions dating back over 50 years. In addition to the deployable solar arrays, which will be used by NASA this year to upgrade the solar arrays on the International Space Station, Redwire has capabilities for 3D manufacturing in space, robotics, camera systems, guidance and navigation control systems, and other components for a wide range of customers.
“We intended to find a profitable partner with strong management, powerful intellectual property and impressive organic growth,” Genesis Park CEO Paul Hobby said in the announcement. “Redwire achieves that vision by transforming the future of space infrastructure and services at a time when the space industry is on the brink of exponential growth. Redwire is a proven, solidly profitable player in the space community and the undisputed leader in on-orbit 3D printing, servicing, assembly, and manufacturing.”
Following the close of the SPAC, Redwire’s existing stockholders will hold approximately 55% of the fully diluted shares of common stock, assuming no redemptions by Genesis Park’s existing public stockholders.
Sharing the news on LinkedIn, Al Tadros, who was named Redwire’s chief growth officer in August, commented, “What’s good for space, is good for Redwire.”