Three European Space Firms Form New Company

Three European space groups – Airbus, Italy’s Leonardo and Paris-headquartered Thales have signed a Memorandum of Understanding (MOU) on Thursday, which is aimed at combining their respective space activities into a new company in order to check the growth of global players such as Elon Musk’s Starlink.

Completion of the transaction is subject to customary conditions including regulatory clearances, with the new company expected to be operational in 2027.

By joining forces, these three companies aim to strengthen Europe’s strategic autonomy in space, a major sector that underpins critical infrastructure and services related to telecommunications, global navigation, earth observation, science, exploration and national security. This new company also intends to serve as the trusted partner for developing and implementing national sovereign space programmes.

The new company will pool, build and develop a comprehensive portfolio of complementary technologies and end-to-end solutions, from space infrastructure to services (excluding space launchers). It will accelerate innovation in this strategic market, in order to create a unified, integrated and resilient European space player, with the critical mass to compete globally and grow on the export markets.

This new player will be able to foster innovation, combine and strengthen investments in future space products and services, building on the complementary assets and world-class expertise of all three companies.

The combination is expected to generate mid triple digit million euro of total annual synergies on operating income five years after closing. Associated costs to generate those synergies are expected to be in line with industry benchmark.

Airbus will contribute with its Space Systems and Space Digital businesses, coming from Airbus Defence and Space and Leonardo will contribute with its Space Division, including its shares in Telespazio and Thales Alenia Space, while Thales will mainly contribute with its shares in Thales Alenia Space, Telespazio, and Thales SESO.

The combined entity will employ around 25,000 people across Europe. With an annual turnover of about $7.58 billion (end of 2024, pro-forma) and an order backlog representing more than three years of projected sales, this new company will form a robust, innovative and competitive entity worldwide.

Stakes in New Company

Ownership of the new company will be shared among the parent companies, with Airbus, Leonardo and Thales owning 35%, 32.5% and 32.5% stakes respectively. It will operate under joint control, with a balanced governance structure among shareholders.

The company, which is still unnamed, is expected to accelerate European leadership in space and ensuring its strategic autonomy, foster innovation and technological progress by harnessing joint R&D capabilities to be at the cutting edge of space missions in all domains, including services, and enhance operational efficiency, benefiting from economies of scale and optimised production processes.

It is also aimed at increasing competitiveness facing global players, reaching critical mass and ensuring Europe secures its role as a major player in the international space market.

In a joint statement, Airbus CEO Guillaume Faury, Leonardo CEO and General Manager Roberto Cingolani, and Chairman and CEO of Thales Patrice Caine said that the new company marks a pivotal milestone for Europe’s space industry and embodies their shared vision to build a stronger and more competitive European presence in an increasingly dynamic global space market.

“By pooling our talent, resources, expertise and R&D capabilities, we aim to generate growth, accelerate innovation and deliver greater value to our customers and stakeholders. This partnership aligns with the ambitions of European governments to strengthen their industrial and technological assets, ensuring Europe’s autonomy across the strategic space domain and its many applications. It offers employees the opportunity to be at the heart of this ambitious initiative, while benefiting from enhanced career prospects and the collective strength of the three industry leaders,” the statement said.