SpaceX has successfully flown 9 missions. Last week’s explosion was only its 2nd mishap.
As an outcome of SpaceX’s satellite launch being destroyed during liftoff, Israel’s Space Communication Ltd is now seeking $50 million from the company or a free flight. Space Com’s satellite was destroyed at SpaceX’s Florida launch site during last week’s take-off.
According to officials of the Israeli Company, along with the $50 million, Space Com could also collect $205 million from Israel Aerospace Industries, which built the AMOS-6 satellite.
SpaceX being a private company, the terms of the contract, including the insurance terms, beyond the mandatory insurance required by the Federal Aviation Administration, are not publicly available.
Unless SpaceX is quickly able to locate the fault which caused last week’s incident, it could suffer significant losses. The company has more than seventy missions on its manifest whose combined valued is nearly $10 billion.
For Elon Musk, this is could be challenging since he faces also serious challenges in the other company that he runs, which includes Tesla Motors and SolarCity Corp.
Last week’s explosion destroyed not only the satellite but also SpaceX’s Falcon 9 rocket. Space Com has disclosed that the loss of its satellite will be significant impact on its market capitalisation with its share prices expected to decline by$30 million to $123 million.
After the explosion, Space Com’s shares have already dipped by 9%. With trading on the shares suspended on Sunday, they slumped further by 34% today.
Gil Lotan, Space Com’s general counsel, has told during a conference call that it is yet too early to speculate whether its planned merger with Chinese Xinwei Technology Group would proceed as per plan.
Earlier last month, Xinwei had agreed to acquire Space Com for $285 million. Significantly, it had said the deal was contingent on the successful launch and operation of Space Com’s AMOS-6 satellite.
“We hope to continue fruitful communications with the prospective buyer,” Lotan said.
Officials from Xinwei have declined to comment on whether the loss of the satellite during explosion would impact the acquisition.
Last Friday, Xinwei had stated that it is in touch with Space Com regarding the impact of the incident on the merger.
On s strategic note, it went on to add that the accident would not impact its broader strategy to establish an an integrated space information network.
The cause of the accident is yet to be known. In damage control mode, SpaceX has said it would shift all impending lift-offs to a second site at Florida, which is nearing completion and which was used last week to launch NASA’s space shuttles.