Globalstar announced that they signed a contract with Alcatel Alenia Space
Globalstar will design, manufacture and deliver the Globalstar second-generation constellation of 48 (LEO) low-earth-orbit satellites. The cost in EURO is 661 million. The contract value could be reduced if Globalstar chooses to accelerate delivery of the constellation. The life expectancy of these satellites is 15 years. This is longer that the first generation satellites. The increased lifespan should provide the Company with a space segment through 2025 at least.“We are extremely pleased with this agreement, which not only secures the Globalstar space segment through at least 2025, but also takes us another step to offering a host of exciting future services while assisting us in our quest to maximize our global spectrum opportunity,” said Jay Monroe.
The agreement is subject to the establishment of an escrow account, which will require the consent of Globalstar’s lenders. Globalstar and Alcatel Alenia Space also agreed that $190 million of the contract payments are to be denominated in dollars with future possible bonus payments of up to $75 million being paid to Alcatel Alenia Space pending both companies meeting certain criteria through 2014.
The second-generation Globalstar constellation will integrate with and eventually replace the current Globalstar space segment, which provides satellite voice and data services to over 120 countries on six continents. The Company expects the new satellites to be engineered to provide greater peak demand call capacity, improved data speeds for file transfer and video applications and improved network management for integrated ATC terrestrial applications, video streaming and broad band data service.
This agreement will involve Alcatel Alenia Space’s production sites in France, Italy, Spain, and Belgium. Globalstar’s second-generation satellites will be assembled and integrated in the Alcatel Alenia Space facility in Rome (Italy). The payloads will be provided by the company’s facility in Toulouse (France) with the structures as well as the thermal subsystems being provided by the facility in Cannes (France). Over the next three years, Globalstar will also send selected engineers and contractors to work with Alcatel Alenia Space in Europe.
In order to supplement its current constellation, Globalstar continues with preparations to launch eight spare first-generation satellites, using two Soyuz launch vehicles, in the first half of 2007. Launch provider Starsem has set two Globalstar launch windows, the first of which begins on March 26, 2007 and the second of which commences on May 14. Alcatel Alenia Space currently is conducting pre-launch preparations on the eight satellites at its facility in Rome, Italy.
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