It is an agreement that is the first major milestone in which these two companies will be providing connectivity services including machine to machine (M2M) and internet of things (IoT) to Latin America from the Pearl Constellation of nano-satellites. The agreement between the two companies is that SAS will provide a strategic distribution agreement with Globalsat Group LLC, for the provision of its connectivity services including machine to machine (M2M) and internet of things (IoT) to Latin America from the Pearl Constellation of nano-satellites, certainly welcome news to a nation where 64 million people are currently without reliable and affordable mobile connectivity, accounting for 10 percent of the total population and representing strong commercial growth opportunities.
Sky and Space Global Ltd (ASX: SAS, “Sky and Space Global” or ‘the Company”) announces it has reached a landmark and signed a distribution agreement with Globlsat Group LLC (GlobalSat) for the provision of narrow-band telecommunications services via nano-satellites.
Under the terms of the agreement, SAS and GlobalSat have established non-exclusive commercial terms for GlobalSat to distribute, sell, market and promote SAS’ narrow-band connectivity solutions and respective products to its customers, affiliates, resellers, subscribers and end-users within Latin America.
The first batch of Pearls is scheduled to be launched mid-2019, and this contract will commence following operational designation of the first batch of Pearls.
Revenue from this contract to commence immediately upon successful completion of in orbit testing and
operational optimization of the first batch of Pearls, expected to be completed within 10 weeks from successful launch.
Once the constellation deployment has begun and as a result of this agreement, SAS expects to generate revenues of US$5 million within the first two years based on the conservative GlobalSat Group estimate, with a significant growth potential, thanks to the extensive amount of current and upcoming GlobalSat clients across the energy, government, defence, mining and agriculture sectors.
Sales will commence immediately following the launch of the first batch of Pearls and the successful completion of in-orbit testing and designation as fully operational. The signing of this agreement follows completion of commercial testing with GlobalSat Group and confirms the commercial potential of SAS’ proprietary nano-satellite technology and the business model.
Additional material terms of the agreement are set out below:
- The agreement has an initial two-year term from the date the SAS network is operational (with a possible option to extend).
- Notwithstanding the fact that the agreement is binding, the parties have agreed to negotiate and execute a more definitive agreement within 60 days, on terms consistent with the agreement signed.
- Pricing for M2M and IoT services has been agreed.
- The agreement may be terminated based on standard termination events (insolvency, breach etc.) or the SAS network does not achieve KPIs (to be agreed).
Sky and Space Global’s Managing Director and CEO, Mr. Meir Moalem said that they are pleased to have finally secured a definitive supply agreement with GlobalSat. This marks a huge milestone achieved for them on the pathway to commercializing their technology. They have been working very closely with GlobalSat for a while now and look forward to seeing how this agreement unfolds.
Managing Director of GlobalSat Group, Mr. Alberto Palacios, added that they are excited to be moving forward with Sky and Space Global and believe that they have the opportunity to significantly improve their service offering with SAS’ nano-satellite technology on board.