D-Orbit to go Public at $1.28B Valuation

D-Orbit Investor deck January 2022 - title slide

Image: D-Orbit. See investor deck here

On the heels of Satellogic ($SATL) completing its reverse merger just this week, another space player is preparing to go public via SPAC.

This morning, D-Orbit announced its intentions to merge with Breeze Holdings Acquisition Corp. (NASDAQ:BREZ). D-Orbit offers “last-mile,” in-space transport services via its ION Satellite Carrier. D-Orbit has used ION in four of its six missions to date. 

Deal details: In Q2 or Q3 2022, the Italian launch services provider will combine with $BREZ, providing D-Orbit a post-deal enterprise value of €1.13B (~$1.28B).

  • Breeze holds $117M cash in trust (which won’t all go to D-Orbit, unless 0% of $BREZ shareholders redeem their shares). The deal is supported by $29M in convertible debt financing from ATW Partners and a $5.5M PIPE. 
  • Breeze and D-Orbit have partnered with the Charles F. Bolden Group, which is led by former NASA Administrator Charles Bolden. 
  • Upon de-SPAC, D-Orbit is expected to trade on the Nasdaq as $DOBT.

In its investor deck, D-Orbit cites its flight heritage (70+ payloads delivered) and traction (40+ “paying customers”). As far as forward-looking projections go, the company says it has a €19M ($21M) revenue backlog, €147M ($164M) of contracts under negotiation, and a €1.1B ($1.23B) “pipeline.” 

  • The proposed deal values D-Orbit at 56.5x expected 2022 sales and 12.2x expected 2023 sales.
  • Reminder: At Payload, we tend to take SPAC projections with a grain of salt. 

Payload’s takeaway: Space SPACs have experienced a volatile year, with most of the cohort trading below their offer price. Plus, mind the macro backdrop. As we wrote earlier this month, “rising interest rates never tend to do tech growth stocks any favors.” Nonetheless, the SPAC option has not fallen out of favor with space companies looking to tap the public markets to support growth and raise money.

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