Rocket Lab will be made public via SPAC with Neutron rocket expansion

Rocket Lab, a leader among companies building small rockets to launch satellites, will be made public through a SPAC merger that values ​​the company at more than $ 4 billion when the deal closes.

The company is being combined with Vector Acquisition, a special purpose acquisition company. Rocket Lab will list the Nasdaq with the RKLB marker when the deal closes, which is expected for the second quarter.

“This milestone accelerates Rocket Lab’s ability to unlock the full potential of space through our launch pads and spacecraft and catalyzes our ambition to create a new multi-million dollar commercial enterprise in space applications,” said Peter Beck, general manager of the Rocket Lab, in a press release.

Currently, Vector SPAC is marketed under the VACQ ticker. SPAC shares rose more than 20% in premarket trading since its previous close of $ 10.25 per share.

The SPAC agreement values ​​Rocket Lab at a business valuation of $ 4.1 billion, with the company expecting to have about $ 750 million in cash once the merger is completed. That money includes up to $ 320 million from Vector Acquisition, as well as a $ 470 million PIPE round led by Vector Capital, BlackRock and Neuberger Berman, among other investors.

PIPE financing or private investment in public capital allows private investors to buy public shares at below market prices. A SPAC is a special purpose acquisition company in which investors essentially give a blank check to a company for the purpose of unspecified acquisitions of other companies.

Beck will continue to lead Rocket Lab as CEO, with Vector Capital Investment Director Alex Slusky serving on the company’s board of directors, alongside Sven Strohband of Khosla Ventures, David Cowan of Bessemer Venture Partner , Matt Ocko of DCVC and independent director Mike Griffin.

Rocket Lab also unveiled plans for a second larger rocket called the Neutron to lift even more payloads than its current Electron rocket. The company has launched 97 satellites in 18 Electron missions so far.

Its Electron rockets are priced at about $ 7 million per launch, with a height of about 60 feet and capable of lifting up to 300 kilograms to low Earth orbit.

Neutron, which is expected to launch in 2024 for the first time, will have a height of 131 feet and will be able to carry up to 8,000 kilograms to a low Earth orbit, the company said. Rocket Lab did not disclose how much Neutron is expected to cost per launch, noting that its first launch will require the company to build a new launcher at NASA’s Wallops flight facility in Virginia.

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