A $150 million bid by U.S.-based Rocket Lab to acquire German laser communications firm Mynaric is facing an extended review by the German government. The delay comes as Europe intensifies its push for greater domestic control over critical space and defense technologies, raising questions about the future of the deal.
The proposed acquisition, announced in March, is pending approval under Germany's foreign direct investment (FDI) regulations. The outcome of this review could set a precedent for transatlantic partnerships in an industry increasingly defined by national security and strategic independence.
Key Takeaways
- Rocket Lab's planned $150 million acquisition of Mynaric is currently under review by the German government.
- The review coincides with a major European policy shift towards developing sovereign space and defense capabilities.
- Mynaric's laser communication technology is critical for next-generation satellite constellations for both commercial and defense use.
- The deal's approval could impact Mynaric's eligibility for key European projects like the IRIS² satellite network.
A Deal in Regulatory Limbo
California-based Rocket Lab confirmed its intent to acquire Munich-headquartered Mynaric earlier this year, a strategic move to vertically integrate a key technology for its satellite manufacturing business. Mynaric is a leading developer of optical communications terminals, which use lasers to transmit vast amounts of data between satellites at high speeds.
This technology is fundamental to the architecture of modern satellite networks, including those used for military purposes. Mynaric's CONDOR Mk3 terminals are already being integrated into satellites for the U.S. Space Development Agency's Proliferated Warfighter Space Architecture, a massive constellation of defense satellites.
During a panel at the MilSat Symposium, Richard French, Rocket Lab’s vice president of business development, confirmed the company is still awaiting the conclusion of Berlin's review. "We obviously have been public that we intend to acquire Mynaric and that requires German foreign direct investment approval," French stated, noting that this would establish the company's first major European base.
A Strategic Choice
Rocket Lab's decision to acquire Mynaric was driven by direct experience with its technology. The company had selected Mynaric's terminals for its own satellites being built under a $515 million contract with the U.S. Space Development Agency. CEO Peter Beck previously called Mynaric's product "the best... the lightest and the highest performing terminal."
Europe's Drive for Strategic Autonomy
Since the acquisition was announced, the geopolitical landscape has sharpened Europe's focus on industrial and technological independence. European governments are now making significant investments to bolster domestic space and defense industries, aiming to reduce reliance on foreign systems, particularly from the United States.
This policy shift is creating a complex environment for transatlantic deals. A central question for German regulators is whether a U.S.-owned Mynaric would still be considered a European company. This designation is crucial for eligibility to participate in major continental projects.
What is IRIS²?
The Infrastructure for Resilience, Interconnectivity and Security by Satellite (IRIS²) is a multi-billion euro program backed by the European Union. Its goal is to create a sovereign, secure satellite communications network for government and commercial use, ensuring Europe's independence in this critical sector. Participation may be restricted to firms controlled by European entities.
Richard French acknowledged the opportunity this new environment presents, suggesting that Rocket Lab would aim to "enhance Mynaric’s ability to compete" for European programs. He expressed confidence that Mynaric's eligibility would not be compromised if the deal is approved.
"I won’t speculate on how it’s going to go, or how it is going. But I think it’s very logical to think that if it all does work out, Mynaric’s ability to bid will be unchanged," French said regarding participation in IRIS².
Germany's National Interest at the Forefront
The German government's decision will likely pivot on national interest. This includes not only economic considerations like job retention but also the strategic importance of Mynaric's technology in the context of national and European security.
Germany itself has signaled a major shift in its defense posture, announcing plans to invest approximately $40 billion in defense space technologies over the next five years. This unprecedented commitment is fueling a domestic push for "sovereign space systems" that can be operated independently of allies, a direct response to growing security concerns.
Industry experts believe the German review will weigh these factors carefully. Randy Segal, a partner at Hogan Lovells specializing in the space industry, commented on the general nature of such reviews without direct knowledge of the Mynaric deal.
"Regulators make assessments on what is good for the country and that varies from country to country," Segal explained. She noted that while some nations prioritize domestic ownership, others may focus on ensuring jobs and facilities remain within their borders.
"If the German government does approve the transaction, you can be assured that they will be supportive of Mynaric after the transaction as well," Segal added, suggesting that approval would imply a long-term commitment to the company's role within Germany.
Implications for the Global Space Industry
The outcome of the Rocket Lab-Mynaric deal will be closely watched by the global space and defense industry. An approval could signal that Europe remains open to strategic foreign investment in its high-tech sectors, provided certain conditions are met. A rejection, however, could indicate a more protectionist stance, potentially complicating future transatlantic collaborations.
For Rocket Lab, the acquisition is a key part of its strategy to become an end-to-end space company, controlling everything from satellite components to launch services. For Mynaric, a publicly traded company on both Nasdaq and the Frankfurt Stock Exchange, the deal offers the backing of a larger, integrated space firm.
As Berlin deliberates, the industry waits to see how Europe will balance its ambition for strategic autonomy with the practical realities of a deeply interconnected global supply chain. The decision will not only determine the future of two companies but also provide a clear signal of Europe's industrial policy in a new era of geopolitical competition.