Rocket Lab completes SPAC merger and begins trading

Aerospace manufacturer Rocket Lab completed its SPAC merger with Vector Acquisition Corporation today and is now trading on the Nasdaq. Rocket Lab founder and CEO Peter Beck joins Squawk on the Street to discuss. For access to live and exclusive video from CNBC subscribe to CNBC PRO: https://cnb.cx/2NGeIvi

Rocket Lab began trading on the Nasdaq on Wednesday, becoming the latest space company to close a SPAC merger and go public — and adding substantially to its cash pile in the process.

“We’re super excited to bring a high-quality space asset to the market,” Rocket Lab CEO Peter Beck told CNBC.

The company merged with special purpose acquisition company Vector Acquisition, which valued Rocket Lab at $4.8 billion in equity. The deal, and the $777 million in gross proceeds from it, will help the company grow its core small rocket business, further expand its spacecraft unit, and build a larger rocket called Neutron to take on Elon Musk’s SpaceX.

“It’s a tremendous amount of capital ... really puts us in a position not only to be aggressive in our organic growth but aggressive on our inorganic growth as well,” Beck said.

A SPAC raises money from investors through an initial public offering and then uses the cash to acquire a private company and take it public.

Shares of Rocket Lab declined over 11% in trading on Wednesday from its previous close of $11.57. Asked about the stock’s debut slide, Beck said he hasn’t “really even been watching it” and emphasized that, “at the end of the day, we’re in this for the long term.”

Rocket Lab is among a trend of space companies going public through SPAC deals, with Virgin Galactic the first of the recent generation, in 2019. Rocket builder Astra, satellite broadband focused AST & Science, satellite data service Spire Global, and space delivery specialist Momentus have each begun trading. BlackSky, Redwire, Satellogic, and Planet are expected to follow in the coming months.

“I don’t think it will take long for investors to differentiate between the company that’s consistently delivering and the ones that have aspirations to deliver sometime in the future,” Beck said.

A maturing space business

Founded by Beck in New Zealand in 2006, Rocket Lab is headquartered in Long Beach, California, and has more than 500 employees.

Rocket Lab is the leader in the small-launch marketplace, with its Electron rocket carrying 105 satellites to space since its first orbital launch three years ago. The company launches from a private complex on New Zealand’s Mahia Peninsula and has built a launchpad at NASA’s Wallops flight facility in Virginia for Electron launches.

Rocket Lab holds a strong position in the launch market next to SpaceX, with the companies currently the two leaders regularly launching privately developed rockets to orbit. Rocket Lab’s launch business booked revenues of $13.5 million in 2018, $48 million in 2019 and an estimated $33 million in 2020. Despite the hit last year, Rocket Lab expects launch revenue growth to rebound this year and steadily climb to $915 million by 2027.

But the launch marketplace — generally divided into the three sections of small, medium and heavy lift — is steadily growing. Rocket Lab’s Electron faces rising competition from the rockets being built by those such as Astra and Virgin Orbit, while Neutron will face off with the rockets of SpaceX, United Launch Alliance, Firefly Aerospace, ABL Space, and Relativity Space.

Beck’s company has recently been testing a method of recovering its Electron boosters — the most expensive part of the rocket — to reuse them, a practice SpaceX has made routine. But unlike SpaceX, Rocket Lab has been testing a new approach given the small size of its rockets. The company uses the friction of atmospheric entry to slow down the rocket, then deploys a parachute and uses a helicopter to pluck the booster from out of the sky.

» Subscribe to CNBC TV: https://cnb.cx/SubscribeCNBCtelevision
» Subscribe to CNBC: https://cnb.cx/SubscribeCNBC
» Subscribe to CNBC Classic: https://cnb.cx/SubscribeCNBCclassic

Turn to CNBC TV for the latest stock market news and analysis. From market futures to live price updates CNBC is the leader in business news worldwide.

The News with Shepard Smith is CNBC’s daily news podcast providing deep, non-partisan coverage and perspective on the day’s most important stories. Available to listen by 8:30pm ET / 5:30pm PT daily beginning September 30: https://www.cnbc.com/2020/09/29/the-news-with-shepard-smith-podcast.html?__source=youtube%7Cshepsmith%7Cpodcast

Connect with CNBC News Online
Get the latest news: http://www.cnbc.com/
Follow CNBC on LinkedIn: https://cnb.cx/LinkedInCNBC
Follow CNBC News on Facebook: https://cnb.cx/LikeCNBC
Follow CNBC News on Twitter: https://cnb.cx/FollowCNBC
Follow CNBC News on Instagram: https://cnb.cx/InstagramCNBC

https://www.cnbc.com/select/best-credit-cards/

#CNBC
#CNBCTV

Видео Rocket Lab completes SPAC merger and begins trading канала CNBC Television