Maxar takes full position of 3D joint venture

Space and imagery company Maxar Technologies has struck an agreement to acquire full ownership of a joint venture held with Saab in an effort to further build data and analytics offerings.

Maxar announced after markets closed Tuesday it will pay roughly $140 million to acquire Saab’s 50-percent stake in Vricon, the venture founded in 2015 to combine Saab’s patented three-dimensional technology with the former DigitalGlobe’s commercial satellite imagery to produce 3D maps and other products for customers.

DigitalGlobe was then acquired by Maxar in 2017 to pair the former’s image library and Earth observation satellite constellation that collect it with the latter’s own satellites and other service offerings.

During a call with investors Wednesday morning, Maxar CEO Dan Jablonsky said the “bulk of (Vricon’s) revenue is being driven by defense and intelligence” customers. He added that other clients include telecommunications companies who use 3D maps of urban settings to determine how to roll out 5G networks.

Regardless of market, all customers are looking to acquire same capability of getting data about the Earth as soon as possible. Maxar is also in the process of rolling out the next iteration of the WorldView constellation that collects Earth imagery and sends it back to the ground. The WorldView Legion constellation’s first two launches are slated for next year.

“There is a lot more we can do particularly as we move into our cloud and ground architecture. The way Vricon has been making products to date has largely been getting data sets from the Maxar archive going into production and then producing those for customers,” Jablonsky told analysts.

“Going forward we’ll be able to match that directly into the workflow, so cloud enabled, really fast timelines sort of overnight deliveries. With the Legion constellation coming online in early ’21, that just supercharges the whole thing because we basically double and triple the amount of data that’s available to go into the 3D products at scale on near-real timelines.”

Vricon has approximately 90 employees and holds a contract with the Army to create virtual, synthetic training environments that incorporate real-world data. The Army chose Vricon in 2019 for that effort called One World Terrain through a $94.7 million Other Transaction Authority prototype agreement.

This transaction is anticipated to close in July. Westminster, Colorado-based Maxar is exercising a call option agreed upon with Saab five years ago to acquire the rest of Vricon and is also issuing $150 million in new debt to fund the purchase.

After the deal’s completion, Maxar’s board of directors plans to add a new member in Gilman Louie, chairman of Vricon’s board and founder of the intelligence community venture capital arm In-Q-Tel.