Space SPAC Index – Astra Space’s Reverse Stock Split Boomerangs

Welcome to S-SPACⁱ! In this edition, Astra Space stock split boomeranged back on itself, and SatixFy and Terran Orbital shares are in the basement.

The boomerang effect

A month ago, Astra Space (Nasdaq: ASTR) undertook a 1-for-15 reverse stock split to get its stock price up above $1.00 and avoid being delisted by the Nasdaq stock exchange. A month later, the stock has plunged below $1.00 again after a Bloomberg report that said Astra was considering selling off a 51 percent share in its spacecraft propulsion subsidiary and other parts of its business. The stock closed at $0.76 on Monday (October 16).

In short, shareholders exchanged a large number of shares worth very little for a much smaller number of shares that briefly rose in value and then precipitously over the past four weeks.

Astra Space has had difficulties from the start. Its original plan was to launch a large number of small satellites using an extremely low-cost rocket. However, its Rocket 3 series compiled a record of two successes, five failures, and one booster destroyed by fire on the launch pad. Astra Space retired Rocket 3 in 2022, and it began work on the larger Rocket 4. Development remains ongoing.

While Astra was struggling to reach orbit, the bottom dropped out of the small satellite launch market. The cause was SpaceX’s highly successful Transporter rideshare missions, which launch small satellites by the bushel. Rocket Lab, Firefly Aerospace, and Relativity Space are all pursuing medium to heavy-lift boosters as a result. Whether they are fighting the last war – hoping to compete with Falcon 9 while SpaceX moves on to Starship – remains to be seen.

Space SPAC Index
October 16, 2023

Astra moved to diversify its portfolio when it acquired spacecraft propulsion manufacturer Apollo Fusion in 2021. TechCrunch reports that the acquisition did not go well.

“Two years ago, Astra hailed its acquisition of satellite propulsion startup Apollo Fusion as a strategic move that would round out its launch business and bring expert engineers into the fold. But under Astra leadership, Apollo Fusion quickly disintegrated, with the majority of the original team resigning, leaving few people to staff the one part of the business that had substantial customer demand and the promise of revenue,” TechCrunch reported.

In the danger zone

Two other space SPACs – SatixFy and Terran Orbital – are in the under-$1.00 basement. SatixFy closed at $0.50 on Monday (October 16) while Terran Orbital closed at $0.73.

SatixFy (NYSE AMERICAN: SATX) is a satellite technology that announced it would be relocating to the United States where opportunities will be more plentiful. As will, one assumes, its competition.

Small satellite maker Terran Orbital (NYSE: LLAP) is facing calls from shareholders to dump CEO and Chairman Marc Bell, reconstitute the Board of Directors, and undertake a strategic review.

Meanwhile, space data provider Satellogic (NYSE AMERICAN: SATX) closed at $1.02 on Monday.