Space42 signs major contract with UAE govt for satellite services and capacity expansion

Space42 signs major contract with UAE govt for satellite services and capacity expansion
by Erica Marchand
Paris, France (SPX) Dec 23, 2024

Space42 (ADX: SPACE42), the UAE-based AI-driven SpaceTech company, has secured an AED 18.7 billion (USD 5.1 billion) contract with the UAE Government to extend its provision of critical, secure communication services through 2043. The agreement builds on Space42's established partnership and further enhances its financial standing, contributing to a backlog of AED 26 billion (USD 7.1 billion) in contracted revenues.

The long-term contract ensures continued secure satellite capacity and managed services using the existing Al Yah 1 and Al Yah 2 satellites, complemented by the upcoming Al Yah 4 and Al Yah 5. These new advanced satellites are set to launch in 2027 and 2028, respectively, and will bolster communication capabilities across the Middle East, Africa, Europe, and Asia.

This new agreement consolidates and replaces two previous contracts - the Capacity Services Agreement and the Managed Services Mandate - that are set to expire in late 2026. Additionally, it integrates ground segment systems, technology management, and terminal operations under a unified framework.

As part of the deal, Space42 will receive AED 3.7 billion (USD 1 billion) in advance payments to fund the development of Al Yah 4 and Al Yah 5. These satellites, based on the Airbus Eurostar Neo platform, will feature multi-band payload flexibility to ensure secure and reliable governmental communications.

Ali Al Hashemi, CEO of Yahsat Space Services, Space42, stated: "We are delighted to sign this contract with the UAE Government, which underscores the ongoing trust in Space42's solutions. The Al Yah 4 and Al Yah 5 satellites will offer new capabilities to advance our technology and service offerings, enabling us to continue providing our innovative SpaceTech solutions that meet the UAE Government's evolving requirements more efficiently, securely and reliably."

Space42's Yahsat Space Services division has made notable progress toward meeting launch targets for the Al Yah 4 and Al Yah 5 satellites. The company recently awarded Airbus the construction contract and chose SpaceX's Falcon 9 rocket to carry the satellites into orbit.

The total cost for the Al Yah 4 and Al Yah 5 program - covering spacecraft construction, launch, ground infrastructure, and insurance - is expected to reach AED 3.9 billion (USD 1.1 billion).

Space42's backlog of AED 26 billion (USD 7.1 billion), equivalent to 10 times its last-twelve-month revenues as of September 30, 2024, ensures strong visibility into long-term cash flows through 2043.