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Skyware Global announced May 23 the launch of Skyware Technologies a spin off company focused on electronics engineering and tactical ground systems.
Image credit: Skyware Global
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[Satellite TODAY 06-05-13] The birth of Skyware Technologies on May 23 will create the potential for better industry focus. This is the opinion of Jay Gullish director space and telecommunications with Futron Corporation, a space and satellite consulting firm.
David McCourt, Skyware’s CEO agreed, during an interview with satelliteTODAY.com. “Focus in itself was reason enough to affect the carve-out,” McCourt said.
McCourt said he is confident business will grow faster as separate entities rather than if the two companies were combined. “Selling electronic products is much more of a process than an event. They are two different businesses, each group having its own products will help the units grow faster.”
Skyware Global has launched a new division that will concentrate on the development, design and manufacturing of its antenna systems for VSAT markets, consumer broadband and DTH.
McCourt said the new division will focus on electronics, especially Ka electronics and full systems and terminals.
“By being more focused on a single industry product group they will be able to better compete,” Gullish said.
McCourt also noted that “employees and customers are excited about it. I think it will allow us to grow in a more focused and controlled way.”
McCourt believes the separation has created a new clarity, noting that “now that the companies are separated around products and customers it will be easier to look for acquisitions and mergers because it’s a much more of a focused search. It allows both Skyware Technologies and Skyware Global to pursue investment opportunities and acquisition activities in each of their respective spaces,” McCourt added.
Skyware’s spin off in mid-May is not unique to the industry, Gullish commented. “We are seeing a lot of companies reorganize, resulting in sales, spinoffs, or mergers.” Gullish said that companies typically tend to spin off divisions to either monetize assets for sale or inoculating assets that are underperforming. Either way in Skyware’s case he believes the spinoff will strengthen its market position.
Asked which company he thinks is stronger from a financial perspective (Global or Technologies), McCourt said, “I think they are both in great shape now.”
McCourt noted that the spin off was not intended for a future sale. “On the contrary, the spin-off was done to allow both companies to look at prospective acquisition and merger opportunities, as well as position us for faster growth as standalone entities.”
McCourt will remain the chairman of Skyware Global and will serve as interim chairman of Skyware Technologies, allowing what company officials predict to be a seamless transition to promote consistency and collaboration. Only time will tell as far as the success of Skyware’s new venture, according to Gullish.
“As with most business plans, the success or failure will depend on Skyware’s ability to implement changes being mindful of customer needs and prices,” Gullish added.
McCourt said he is optimistic the spin-off will create potential for increased revenue. “Both companies will be able to grow faster with the increased focus. Both businesses should each be able to grow by 20 percent the coming year,” McCourt said noting that challenges come along with the additional revenue opportunities. “The largest challenge as always is execution,” McCourt added.
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