Sierra Nevada Corp, owned by billionaires, creates a new space company to bet on an economy in low Earth orbit

Another company comes into the commercial space industry, but unlike many of the new companies that capture the imagination, this one already promotes billions of dollars in business.

And maybe soon he could be courting investors.

The private corporation Sierra Nevada Corporation (SNC) creates Sierra Space, an independent commercial space company with a portfolio that includes, among other things, a reusable space plane and a commercial space station: big bets in development that the new organizational structure is intended to accelerate.

“Our space business is a unique example of our growth strategy. What started with a $ 40 million acquisition has increased its revenue by 10 times to $ 400 million today and will reach $ 4 million. in 5-10 years’ time, “writes SNC President and President Eren Ozmen. , in an internal email from the company distributed Tuesday and seen by CNBC.

“To achieve this growth and an even greater impact more quickly, today we announce that our space business area will become an independent and commercial space company … Sierra Space will continue to be part of the SNC family as a subsidiary and will continue deep cooperation and synergy between customers, technologies and many shared activities. “

Sierra Nevada Corporation, headquartered in Sparks, Nevada, is 100% owned by the team of husbands and wives, Fatih and Eren Ozmen, Turkish immigrants turned billionaires, who turned SNC into a multimillion-dollar national defense and security contract. . More than a decade ago they saw the opportunity to start investing in space capabilities and technology, betting personally, just as other deep-pocket visionaries like Jeff Bezos, Elon Musk and Richard Branson have done, that a new sector private space economy could one day take off.

Ozmen’s vision encompasses space transportation, destinations, and infrastructure, even in low Earth orbit, as it opens up to commercialization.

“Imagine a vibrant economy from Earth’s low orbit with fleets of Dream Chaser spacecraft, a commercial space station, expandable LIFE habitats that can travel to the Moon and Mars, and critical infrastructure such as power generation, propulsion and environmental systems, ”the internal email states.

Sierra Space will have the reusable Dream Chaser space plan currently under development: a “space taxi” that, designed in part after the space shuttle, will be able to land on any airport runway in the world capable of supporting a Boeing 737 aircraft.

Dream Chaser, designed with the capacity to carry people and goods, is currently contracted with NASA to carry out six cargo supply missions to the International Space Station until 2024. Its first flight to NASA is expected in end of next year.

SNC has also recently unveiled its commercial space station, an integrated prototype of free flight for which testing will soon begin at the Kennedy Space Center in Florida. The station is made up of LIFE inflatable habitats that the company has designed for long-term stays in space and is expected to compete for NASA funding in the agency’s recently introduced commercial project LEO Destinations (CLD) .

In total, SNC’s space portfolio totals $ 3 billion currently in active contracts.

The creation of Sierra Space occurs as commercial efforts spread throughout the industry, as more rocket companies reach orbit, space tourism plans proliferate, and the Biden administration proposes an increase in six percent budget for NASA in fiscal 2022.

Investors have also been waking up the sector in a significant way. A growing number of new space companies have been interested in making themselves public through special purpose acquisition companies and Cathie Wood’s new Ark Space Exploration & Innovation ETF is about to be one of the fundraising projects with more success.

Although the company’s e-mail does not deal with it, the new structure could generate more flexibility if capital is raised. It is currently unclear if and how the Ozmens will face external investment, but noted the openness to the possibility in an interview with CNBC’s “Squawk on Street” last December.

“We have an open mindset because we see that contributing capital will allow us to significantly increase and accelerate our growth,” Eren told CNBC at the time.

“We have this vision … it is possible that we will get there sooner rather than later … if we take advantage of some of the capital markets. There is this illusion that cannot be ignored, whether they are SPAC, I mean that valuations are levels higher, investment is a record high, ”added Fatih, who is CEO of SNC, during that same interview.

Tuesday’s internal email says the CNS staff will learn more in the coming weeks and months about the steps being taken to transit the space business. It is likely that a few months will pass before the new Sierra Space company will operate independently.