Rocket Lab USA, a provider of launch services and space systems, has entered into a non-binding term sheet with certain lenders to acquire a controlling equity position in Mynaric AG, a provider of laser optical communications terminals for air, space, and mobile applications. The acquisition, if accomplished, is expected to further strengthen Rocket Lab’s capabilities as a launch provider, spacecraft manufacturer, and supplier of satellite components at scale. With an initial purchase price expected to be approximately $75 million, which represents a fraction of the over $300 million invested in Mynaric to date, Rocket Lab would establish its first European foothold in Munich, opening up incremental European growth opportunities across Rocket Lab’s products and services offerings. The acquisition would provide extensive production assets, intellectual property, product inventory, and committed backlog related to satellite-to-satellite optical connectivity solutions for next-generation constellations, augmenting Rocket Lab’s portfolio of satellite components, subsystems, and software. This acquisition, if completed, would support Rocket Lab’s ability to further vertically integrate the manufacturing and management of its own future high-value satellite application ambitions. Following the deal’s completion, Rocket Lab intends to boost production of Mynaric’s optical terminals to address the demand for laser communication technology at affordable prices and at scale. A key driver for the proposed acquisition is Mynaric’s status as a subcontractor to Rocket Lab, providing CONDOR Mk3 optical communication terminals for the company’s $515 million prime contract with the Space Development Agency (SDA) to produce 18 satellites for the Tranche 2 Transport Layer-Beta. Mynaric is also a supplier into other SDA contracts, and the companies share multiple customers spanning commercial constellation operators, prime contractors, and defense and civil government agencies. The transaction is expected to close after the completion of Mynaric’s pending restructuring proceedings under German law, the completion of which would result in certain outstanding debt held by the lenders converting into 100% of the equity of Mynaric — subject to receipt of applicable regulatory approvals. Rocket Lab may fund this and other future acquisition opportunities with proceeds from equity offerings. Last year, Mynaric made changes to its leadership following a significant decline in revenue that the company ascribed to production delays related to its CONDOR Mk3 optical communications. The company named Andreas Reif as its chief restructuring officer and a member of the management. Following the changeup in management, the company advanced its production for the CONDOR Mk3, improving production yields and supply chain-related bottlenecks. The company has faced challenges retaining compliance with the Nasdaq continued listing criteria, receiving multiple letters of deficiency culminating in the company’s delisting from the Nasdaq last month after the company secured a $28 million dollar bridge loan and extended three of its outstanding bridge loans. Mynaric stated earlier this week that it is continuing to ramp up production and customer deliveries of the CONDOR Mk3 optical communications terminal.