Satellite-AIS data provider exactEarth has entered into an agreement to divest four satellites from its first-generation constellation, as well as its ground station assets, to IoT data firm Myriota Canada.
In consideration for the assets, exactEarth will receive payment of CA$600,000, comprised of CA$150,000 cash and CA$450,000 in preferred shares of Australia-headquartered Myriota.
Under the terms of the deal, Myriota Canada will continue to provide exactEarth with satellite-AIS data originating from the four satellites, as well as the other satellites in exactEarth’s first-generation constellation, for their remaining operating lifetimes.
exactEarth will retain ownership of the EV2 and EV8 hosted AIS satellite payloads from its first-generation constellation, as well as the data licence with the Government of Canada related to the M3M AIS satellite.
Four of exactEarth’s full-time personnel will cease employment with exactEarth and will become employees of Myriota Canada.
“This transaction, which is subject to Canadian regulatory approval, will achieve several strategic objectives,” said Peter Mabson, President and CEO of exactEarth.
“First, it lowers our cost base and reduces our annual cash outlay by a meaningful amount, which will strengthen our financial position and move us more rapidly toward our goal of being cash flow positive. Second, it positions our business and overall financial profile more in-line with that of a pure-play data services business, one with stronger margins and significant recurring revenue.”
“Third, we will maintain access to the AIS data from the satellites to support our service and by extension we will continue to maintain a working relationship with Myriota, a company that exactEarth has invested in and one that we have built a strong business relationship with over the past several years.”
The closing of the sale is subject to Canadian Government regulatory approvals, and is anticipated to take place in the third quarter of 2020.