16 deals show space SPACs have a poor record for investors

A SpaceQ review of 16 space companies that went public through a special purpose acquisition company (SPAC) finds that investors who kept their shares have lost money on 11 of them. NorthStar Earth & Space, which listed on Oct. 2, is the newest space company to go public this way.

A SPAC is a listed shell company that raises money, holds it in a trust and then merges with a private business. U.S. SPACs, including every one in this review, sold their shares at US$10, and investors who dislike the deal can take about that amount back before the merger closes, a step called redemption. All figures in this story are in U.S. dollars unless noted.

Of the space companies that listed this way before NorthStar, only Intuitive Machines traded above $10 three years after its deal closed. Half are now worth about $2 a share or less.

Four of the companies have since left the stock market. Virgin Orbit went bankrupt little more than a year after listing, and Astra’s founders took it private for pennies a share. Lockheed Martin bought Terran Orbital, and Montreal’s MDA Space bought SatixFy, each for a fraction of the $10 their investors started with.

The $10 test

SpaceQ scored each completed deal on five tests: the share price against $10 one year after closing, three years after closing and today; whether the company survived on its own; and how much of the revenue forecast in its SPAC pitch it went on to deliver. Prices are adjusted for reverse splits. How SpaceQ scored the deals is explained at the end of this story.

Three passed the tests: Rocket Lab, Iridium and Intuitive Machines. Three were mixed: AST SpaceMobile, Planet Labs and Redwire. The other 10 failed.

Iridium, Rocket Lab, AST and Planet all traded below $10 three years after their deals closed, and recovered only once their businesses delivered. Rocket Lab, the best performer, announced in June that it would buy Iridium, the first of the space SPACs.

The promise gap

In the years for which their SPAC presentations gave figures, the companies booked about 21 per cent of the revenue they projected. Without Rocket Lab, which came close to its targets, the rest delivered about 13 per cent.

Momentus, an in-space transport company, told investors in 2020 it would earn nearly $2 billion in 2025. It reported about $1 million.

Researchers at the University at Buffalo found that SPAC targets making the most aggressive forecasts later fell furthest short of them, and of their peers.

What winners had

Six companies had less than $10 million of revenue in the year their deals closed, and all six failed. Each of the three winners had at least $35 million of revenue and hardware or contracts already working when investors voted.

Five deals collected less than two-thirds of the money they advertised, mostly because investors redeemed, and all five failed. Virgin Orbit raised about $228 million against the $483 million it had hoped for, roughly half what its own pitch said it needed to turn a profit.

Economists Minmo Gahng, Jay Ritter and Donghang Zhang studied SPAC mergers from 2010 to 2020 and found that deals in which most investors redeemed did markedly worse over the following year than deals in which few did.

Intuitive Machines passed even though about 93 per cent of its public shares were redeemed. It already had $86 million of revenue, most of it from NASA contracts.

NorthStar’s starting point

NorthStar’s post-closing report to the U.S. Securities and Exchange Commission (SEC), filed Oct. 7, puts its 2025 revenue at about $8 million, below the $10-million mark under which every earlier space SPAC failed.

Holders of about 96 per cent of the public shares in Viking Acquisition Corp. I, its SPAC partner, took their money back, leaving about $9 million in the trust.

A private placement, or PIPE, led by Cartesian Capital Group added about $23 million of new money, roughly 73 per cent of the cash raised in the deal. Without it, the money left in the trust would not have covered the deal’s costs and loan repayments.

The PIPE investors paid about $5 a share in effect, SpaceQ reported from the deal filings, because each $10 share came with one of the sponsor’s founder shares and a warrant.

After deal costs and loan repayments, NorthStar kept about 9 per cent of the $260 million that would have been available had no one redeemed, the filing’s pro forma figures show, a smaller share than any earlier space SPAC for which figures exist.

NorthStar had about $300,000 in cash at the end of June, before the deal closed, the filing shows. The PIPE money is what keeps it running while it builds revenue.

So few public investors stayed that they now hold about 0.4 per cent of the company. Its largest shareholders, among them executive chair Charles Sirois with about 26 per cent, have agreed to hold their shares until about the end of March.

Chief executive Stewart Bain framed the listing around the network NorthStar wants to build. “Becoming a public company gives NorthStar the resources to accelerate what we set out to build: a space-based sensor constellation that delivers trusted intelligence on the orbital environment,” he said in the company’s Oct. 1 closing announcement. The shares, trading on NYSE American as NSTR, closed their first day at $4.45, less than half the $10 benchmark.

The SPAC pitch projected more than $30 million of revenue for 2026. NorthStar booked about 20 per cent of that in the first half, the filing shows.

In July a tribunal of the International Chamber of Commerce (ICC) dismissed NorthStar’s claims against Spire Global over hosted sensors that underperformed in orbit and awarded Spire about $12 million, more than NorthStar’s revenue for all of 2025 and about 52 per cent of the cash it kept from the merger. NorthStar’s June 30 financial statements record the debt, but its filings do not say whether it has been paid.

NorthStar has since agreed to fly its next sensors on Kepler Communications satellites rather than build its own satellites. It has also named a new chief technology officer, Peter Klimas, and a technical director for its U.S. operation in Virginia, Armelle Franklin, who led space defence programs at Northrop Grumman.

In June NorthStar announced a $40-million contract, in Canadian dollars, to supply space-surveillance data to the Royal Canadian Air Force over 12 months, the kind of funded government work every winner had. Its Canadian prospectus lists six contracts the air force’s space division has awarded NorthStar, but does not identify the June deal or put a value on any of them.

NorthStar is among the first space companies to list under SEC rules that took effect in July 2024. They make the private company liable alongside the SPAC for what the merger filing says, and they removed a legal shield that had protected forecasts.

Canada’s back door

Maritime Launch Services, which is building a spaceport in Nova Scotia, took a cheaper route in April 2022. It went public through a reverse takeover, merging into a dormant listed shell, Jaguar Financial, and began trading on what is now Cboe Canada. Figures in this section are in Canadian dollars.

Maritime Launch raised about $7 million in a private placement, with no trust for investors to drain, and listed at about 17 cents a share. It had held SPAC talks with Ceres Acquisition Corp. earlier that year, which ended without a deal. SpaceQ noted at the listing that many space SPACs had already lost half their value.

Maritime Launch got by on small raises for years, and its share count has nearly doubled. Then a launch-pad lease with the Department of National Defence (DND) and a $10-million investment from MDA Space changed its course. The company reported its first operating profit in the second quarter of 2026, and its shares traded at 43 cents in August.

UrtheCast, the Vancouver satellite-imaging company, listed through a similar reverse takeover in 2013 and sought creditor protection in 2020.

The next test

Six defence, space and satellite companies announced SPAC mergers in 2026 through mid-September, double the 2025 total, Reuters reported. Among them is Quantum Space’s planned deal at about $1.2 billion.

NorthStar has conditional approval to list on the Toronto Stock Exchange (TSX), but to qualify it must spread its shares across a minimum number of public shareholders by Nov. 30.

Iridium, Rocket Lab and Intuitive Machines had working businesses before they listed. NorthStar listed with about $8 million of revenue and a forecast of more than $30 million for this year.