Japan's MUFG Bank, two others lead $290 mln Sierra Space fundraising

MUFG Bank is among three Japanese firms leading a $290-million fundraising round for U.S. spaceship company Sierra Space, spearheading a commercial "spaceport" project in the southwestern region of Oita, the companies said on Tuesday. Despite recent setbacks for national space missions, Japanese companies aiming to foray into space are increasingly deepening ties with private companies, from American giants such as SpaceX to home-grown startups.

MUFG Bank is among three Japanese firms leading a $290-million fundraising round for U.S. spaceship company Sierra Space, spearheading a commercial "spaceport" project in the southwestern region of Oita, the companies said on Tuesday.

Despite recent setbacks for national space missions, Japanese companies aiming to foray into space are increasingly deepening ties with private companies, from American giants such as SpaceX to home-grown startups. MUFG Bank, insurer Tokio Marine & Nichido Fire and trading house Kanematsu together invested several tens of billions of yen in Sierra, gaining a stake in the unlisted company that was now valued at $5.3 billion, Sierra said.

The investments from Tokio Marine & Nichido Fire, a unit of Tokio Marine Holdings, and the two other companies is part of a "long-term strategic relationship with our Japanese partners", Sierra's CEO Tom Vice said in a statement. Prior Sierra investors General Atlantic, Coatue and Moore Strategic Ventures, which in 2021 led a $1.4 billion Series A fundraising for the company, also participated in the latest funding round, Sierra said.

Sierra Space, spun off in 2021 from billionaire-owned Sierra Nevada Corp, is among a handful of space industry players attempting to build a private space station that NASA hopes will replace the two decade-old International Space Station by 2030. Rivals in the space station business include Houston, Texas-based Axiom Space, which in August closed a $350 million funding round anchored by Saudi investors Aljazira Capital and South Korea's Boryung Co., Ltd.

Sierra next year expects to launch its first Dream Chaser spaceplane, designed to carry cargo and crews to orbit. The company signed a partnership in December with Kanematsu, Japan Airlines and the Oita prefectural government to turn a regional airport into Asia's first "horizontal spaceport". The Oita project took a hit this year from the bankruptcy of another U.S. space company Virgin Orbit, which had partnered with airline ANA Holdings.

MUFG Bank, one of Japan's three biggest, has invested in domestic space startups such as orbital debris-removal firm Astroscale. Tokio Marine's rival Mitsui Sumitomo Insurance said it provided the world's first "lunar insurance" to ispace inc's moon landing mission, which failed in April.

The vigorous commercial projects stand in contrast with the Japan Aerospace Exploration Agency's (JAXA) unsuccessful space missions since last year. But its SLIM lander launched this month would make Japan the fifth in the world to put a spacecraft on the moon if the early 2024 mission succeeds. ($1=148.8700 yen)

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