CANBERRA: Electro Optic Systems Holdings Limited (EOS), acting through its wholly-owned US subsidiary EOS Defense Systems USA, has executed an agreement to acquire all of the business and assets of Audacy Corporation, a space communications company based in the US.

EOS Defense Systems (EOSDS) will outlay approximately AU$10 million in cash for the acquisition including substantial costs associated with securing mandatory US government spectrum licenses and other acquisition costs.

EOSDS is an Alabama corporation with its principal place of business in Huntsville, Alabama. Until recently, EOSDS was principally focused on the establishment of US production capacity for EOS remotely controlled weapon systems and counter-unmanned aerial systems products.

EOSDS production capacity establishment in Huntsville is on schedule, and EOSDS has been restructured during 2019 to support a wider range of EOS business activities in the US in the areas of space, missile defence and space communications.

Audacy Corporation was granted a space station (satellite) spectrum license by the US Federal Communications Commission (FCC) on 4 June 2018, authorizing it to use specific microwave spectrum bands for communications to, from and among specific satellites and ground-based communication terminals.

Implementation of the license requires the launch of a constellation of new mid-earth orbit (MEO) satellites to establish a wideband communications capability for continuous, real-time data transfer with low earth orbit (LEO) satellites and other space vehicles.

The spectrum license requires the licensor to launch them EO satellite constellation by June 2024. Space station licenses are legal permits which allow an entity to establish, operate and maintain communications satellites, including authorization for use of specific spectrum bands.

Such licenses are a statutory requirement for all microwave communications, and are controlled and coordinated globally by the International Telecommunications Union (ITU) and for US operators by the FCC.

The ITU, the FCC and related government organisations regulate the microwave spectrum because microwave transmitting sources can interfere with each other and must be separated physically in space and in spectrum.

EOS has an established space communications business with advanced technologies for both microwave and optical (or laser) communications. In the long-term EOS expects most space communications to be implemented with optical communications-a technology that is not regulated or controlled because it cannot interfere with other users.

However, 99% of all space communications presently employs microwave technology, with existing sunk costs for this technology of overAU$700billion.Acknowledging the current dominance of microwave technology, EOS has decided to enter the regulated microwave communications domain through the Acquisition, as one of several channels the Company intends to apply to commercialise its optical, microwave, and hybrid microwave-optical communication technologies.

In a statement today, Ambassador John Berry(Ret), the Chairman of EOSDS said: “Following Completion of this Acquisition EOS will be able to build a satellite network that will provide a comprehensive, end-to-end communications and data transfer service to government and commercial customers globally through a new constellation of EOS satellites in MEO. We are confident of achieving all mandatory milestones required by the spectrum licenses granted to Audacy Corporation including a requirement to build and launch satellites that will achieve a capability in space by June 2024.

“Using new technology, including technology from EOS Space Systems Sector and EOS Communications Sector, our satellite constellation is expected to provide a combination of higher performance, higher resilience and lower cost than is available currently”.

Dr Ben Greene, the Group CEO of EOS added: “EOS has previously disclosed its intention to enter the space communications market, and the acquisition represents a logical next step towards that goal”.