In September 2008, Andrew Amphlett was asked to prepare an analysis of Cambridge Space Systems plc, a private company headquartered in Cambridge, England. Amphlett, a recent MBA graduate from the London Business School, was employed as a financial analyst at Equator Partners, a private equity firm established by Peter Standish, Paul Dimson, and Elroy Marsh.

Equator Partners specializes in acquiring small but focused firms in the space and defense industry with excellent prospects for generating cash flows. The acquired companies were restructured and, after operating for several years, were usually sold to larger firms in the industry. Paul Cootner, founder and CEO of Cambridge Space Systems, had approached Equator about a possible buyout of the firm he had launched in 1994.

Company Background Cambridge Space Systems plc developed and manufactured small rockets and space systems for commercial, military, and civil government customers, including the U.K. Department of Defense, the U.S. Department of Defense, the National Aeronautics and Space Administration (NASA), as well as other U.K. government agencies. The company’s primary products and services included the following:

• Launch Vehicles. Rockets are used as interceptor and target vehicles for missile defense systems, small-class space launch vehicles that place satellites into Earth orbit, and suborbital launch vehicles that place payloads into a variety of high-altitude trajectories.
• Satellites and Space Systems. Earth-orbiting satellites, interplanetary spacecraft, and related systems for communications, remote sensing, scientific and military missions, satellite subsystems, and space-related technical services.
• Transportation Management Systems. Software-based transportation management systems for public transit agencies and private vehicle fleet operators.