Presentation PPP Rome 26 05 - asi.it · Astrium Services PPP : An Innovative Way for Governmental Outsourcing Rome 28th May 2009

Astrium Services

PPP : An Innovative Way for Governmental Outsourcing

Rome 28th May 2009

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ASTRIUM SERVICES

Company ProprietaryCompany Proprietary

Astrium: part of EADS, a global leader in aerospace and defence

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Eurocopter Astrium Defence& Security

EADS

AirbusAirbus Military

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ASTRIUM SERVICES


Astrium’s activities are based in three keyareas

Astrium Services

AstriumSatellites

Astrium SpaceTransportation

The European prime contractor

for civil and military spacetransportationand manned

space activities

A world leaderin the design

and manufacture of

satellitesystems

At the forefront of satellite services

in the securecommunications,

Earth observation and navigation fields

Aug-08 - P 4

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ASTRIUM SERVICES

Company ProprietaryCompany Proprietary��

TELECOM SERVICES

Services to national MoDs and NATO

The unique one-stop-shop provider for

commercial and military bands services

Astrium Services

NAVIGATION

Services to governmental and professional users

A start up in the development of satellite navigation applications

EARTH OBSERVATION

Services to governmental and commercial users

The European leading provider of geo-

information products and services

SECURE SATCOM SYSTEMS

Systems and Ground Segments to MoDs

The UK leader for space secure communications

systems & ground segments

One Stop Shop Service Provider

Aug-08 - P 5

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ASTRIUM SERVICES


�Full range Telecommunications Services� Secured, resilient end-to-end communications

� Own satellite fleet (Skynet-4 & -5) in UHF and X-band

� Secured Satcom Systems� Network Systems and Terminals

� Navigation – High Precision Positioning� Value-added services as a key for navigation applications

� Earth Observation – Data and Services� Exclusive satellite fleet (plus reseller terms)

� Unique High Resolution optical & radar datasets and

operational added value services capabilities

One Stop Shop Service Provider

Aug-08 - P 6

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ASTRIUM SERVICES


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Hisdesat (since 2001) Spanish military satellite operator

Paradigm(since 2003)

� Provider of all satellite services for UK MoD� Prime contractor for UK Skynet system� Focal point for third party sales� Welfare services & customer support for the Armed Forces

London Satellite Exchange� (since 2006) Commercial satellite capacity management company

MilSat Services� (Since 2006) Provider of the German Bundeswehr’s satellite communications

system SatcomBW Step 2

100%

100%

15%

75%

100% Infoterra� Provision of geo-information products and services: Infoterra present in Ge, Fr,

UK, Sp and Hungary.

100% GPT� (since 2007) Saudi Arabia National Guard telecom services operator

82%

100% Imass� (Since 2008) Provision of practical and integrated software solutions for public

safety, utilities and manufacturing design sectors.

SPOTIMAGE� World leading supplier of EO imagery (SPOT family, FORMOSAT 2,

KOMPSAT 2, Envisat, etc)

Aug-08 - P 7

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ASTRIUM SERVICES


Main Projects

SATCOM Bw Step 2Dedicated secure satellite communications

Skynet 5Secure military satellite communications services

YAHSATComplete system delivery to UAE

TerraSAR-XExclusive commercial exploitation rights held by Infoterra GmbH

GPTTelecom infrastructure provision and maintenance for the Saudi Arabia National Guard

ASTEL S One-stop-shop for the French MoD

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PASSERELWelfare telecommunications services for Economat des Armées for French troops overseas

TelcomarsatDeployment of a VSAT network on 54 ships of the French navy and upgrade of teleport infrastructures

Aug-08 - P 8

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ASTRIUM SERVICES


Public Private Partnership (PPP)

� Today, MODs and Governments are focussing on core tasks and competencies

� Growing public infrastructure needs…� ...but decreasing budget headroom� Prioritisation of resources� Transfer of risk

� Definition of PPP:� Alternative procurement scheme: Service Provision rather than Asset Purchase� Long term partnership between Public and Private Sector: Efficiency gain through Life Cycle

Management. � Private financing, Shifting of risks to Private Sector

- In the UK, 15% of all Government spending in Public Services, incl. 53 MoD Projects, are PPPEfficiency gain generally between 10-15%

- Other Countries starting to use PPP or service approaches (Germany, Spain, France, …)

Aug-08 - P 9

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ASTRIUM SERVICES


Challenges of PPP How to compare apples with pears?

� Valuation of a PPP: � Net present value (NPV) of payments � Taking into account the risks on the full life

cycle (PSC: Public Sector Comparator) � Payments indexed on performance

� Key success factors of a PPP: � Detailed definition of needs� Optimal risk transfer � Alignment of objectives

� But also other Challenges:� Political will to outsource?� Critical project size; time to closure� Separation between

Investment- and Operative budgets� Finding the right private partner

(with appropriate Customer focus, Defence Industry know-how, financial backing)

A challenge for the Public and Private sector

Assets Assets(optimized

life cycle cost)

Asset Procurement

PPP(Unique Client)

Overall Cost(Net Present Value)

Same capabilityfor less €

Risk Mangmntincl. Insurance

Risk Financing Cost

Financing Cost

Contract Negotiations Contract

Negotiations

OperationsOperations

Total Costfor

Anchor Client(including

benefit of risk transferred to

private partner)

PPP(incl. 3rd Parties)

Pooling

Aug-08 - P 10

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ASTRIUM SERVICES


Paradigm provides end-to-end, tariff based, resilient, secure communications services to the MoD and other third party users

� The services provided are:- Cost-effective, survivable, secure- Guaranteed and give continuity of service- Benchmarked- Provided through a long-term ‘one-stop-shop’ provisioning

arrangement with the private sector

� and:- Support allied interoperability- Exploit “civil” and “military” technologies- Not necessarily satcom exclusive

� Second largest UK MOD PPP contract: above £3B

SKYNET 5 ContractSecure military communications services

Aug-08 - P 11

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ASTRIUM SERVICES


Paradigm supports the full range of Military SATCOM Assets

SKYNET 4

Military Communications over Commercial SATCOM Bearers

• 40 Satellite Access Cabins

• >1000 Iridium & Globalstar terminals• 24 million minutes per annum• Iraq (Op SYNERGY), Balkans

Airborne Terminals

Submarines(INMARSAT, UHF, SHF and EHF terminals)

2 x UK SGSOakhanger, Colerne

+ NCS Corsham

2 x SGS (Germany)

Rheindahlen, Gutersloh

Cyprus, Falklands

REACHER Large

REACHER Medium

REACHER RM

Interim REACHER

Medium Transportables

‘Dagger’ Vehicle-mounted

Patrol Manpack

UHF TACSATX Band SCOT fits, (inc SKYNET 5 upgrades)

UHF TACSAT

INMARSAT A/B

SKYNET 5

Aug-08 - P 12

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ASTRIUM SERVICES


Skynet 5 PFI - 5 years after : a success story

� Services delivered and tested in hostile operations (Iraq, Afghanistan,...)

� Monthly metrics achieved (based on 200 indicators)

� Value for money service regularly benchmarked by the UK MoD

� Industrial milestones achieved on time and according to performances required� Skynet 5 system launched and delivered on time and on budget� Ground segment renovated

� Flexibility, reactivity, innovation of PPP to meet MoD new requirements (Texlink, IDS, Synergy network,...)

� Services for third parties :� NATO : 15 year contract with F and IT� Other European (NL, P, F ...) and non European countries (USA,

Canada, Australia…)

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ASTRIUM SERVICES


Advantages for customers

� Precise definition of the need and of the project, through dialog� Cost reduction through

� Life Cycle project Management� Risk transfer to Private Sector + tight risk management� Third Party revenues

� Smooth payment profile; Reduced public debt� Capability delivered on time, on budget, to specification� End-to-End service guarantee, flexibility of services� Better performance due to performance incentive� Pay for service, not for assets� Maintenance and upgrades included� Private sector experience and innovation: new solutions

PPP: More value for Money!

Aug-08 - P 14

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ASTRIUM SERVICES


Conclusions� PPP

� Is an on-going trend in Europe� Reduces and spreads the burden on public budgets� Allows for a better allocation of risks� Long term approach encourages investment, innovation

and flexibility most often at no extra cost for the MoD

� Trust and partnership are key to successful PPP

� Considering the new political and budget contexts in both Italy and France, PPP or Service solutions could represent attractive choices for current and future programmes

Aug-08 - P 15

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ASTRIUM SERVICES


Astrium Services: recognised Expertise and Success:

Minister for Defence Procurement Award - 2004 Infrastructure Journal - Deal of the Year - 2003

Thompson Financial PPP deal of the Year - 2003 Project Finance European Defence PPP of the Year

Battlespace Businessman of the Year 2006Best Securitisation of European Assets - 2006

(Euroweek)Re-financing of the Year – 2006 (Project Finance

International)

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ASTRIUM SERVICES


ANNEXES

Aug-08 - P 17

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ASTRIUM SERVICES


New procurement context in Europe for Milsatcom: PPP, a new model for Defence

� In UK, Paradigm offers complete end-to-end services to the UK MOD

� In France, the Government has recently decided to investigate the project to establish a PPP, which would include the sale of the two Syracuse 3 satellites and the Sicral 2 French payload to a private operator

� Operator to acquire the constellation and become the provider of the French MoD in X Band secured satellite communications ;

� RFP expected soon

� In Italy, SICRAL 1B satellite co-financed by IT MoD and by Finmeccanica/Telespazio

� Telespazio entitled to commercialise SHF and UHF capacity� Provides back-up Mission, Management & Control Centres at Fucino Teleport

Aug-08 - P 18

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ASTRIUM SERVICES


� In Germany, the German Bundeswehr selected Astrium Services in 2006 to be the provider of its satellite communications system SatcomBW Step 2 (two satellites, using X-band and UHF)

� The satellite assets remain the property of the Defence

� Astrium Services is the operator of the control & mission facilities and anchor stations and provides additional services using commercial satellites (C and Ku-band)

� In Spain, Milsatcom system and services are provided through a private Spanish company called Hisdesat which financed, launched and today operates Spainsat satellite (X-band) in 2006.

� Astrium Services owns 15% of Hisdesat

New procurement context in Europe: PPP, a new model for Defence

Aug-08 - P 19

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ASTRIUM SERVICES


A Typical PPP Structure: The Paradigm Organisation

Concession agreement

BackingFinance

Agreements

Subcontracts

Banks

Other Customers

UK MOD

ConstructionCompany

OperatingCompany

Special PurposeVehicle (SPV) Shareholder

UKCustomer

Lenders

Satellites

Aug-08 - P 20

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ASTRIUM SERVICES


PFI Skynet 5 : First a Service Contract

� Paradigm is fully responsible for service provision

� End to end services : from in orbit capacity provision

to end user training and terminal maintenance in

theatre

� Service delivery commitment � Paradigm assumes the risks to maintain these engagements until 2020

� Payment according to usage and quality of service –“No service no pay” principle

� Paradigm constantly adapts technical solutions to meet the customer requirements

Aug-08 - P 21

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ASTRIUM SERVICES


The MilSat Services JV with ND SatCom serving the German Armed Forces

� New satellite infrastructure (2 satellites)� Ground network upgrade and extension� Commercial satellite capacity provision

SATCOMBw Step 2Secure Communications for German Bundeswehr

I I

TDLTDL

Aug-08 - P 22

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ASTRIUM SERVICES


Infoterra GmbH holds exclusive commercial exploita-tion rights for TerraSAR-X high resolution radar data

� PPP with DLR � Technical features (1m resolution, high acquisition

flexibility, rapid data delivery,…) designed to secure commercial success

� Customers from public and civil markets targeted� Twin satellite constellation with TanDEM-X

(developed under similar scheme) enables highly accurate digital elevation model generation (launch: 2009)

TerraSAR-XRadar satellite financed under DLR/Astrium PPP

TerraSAR-X was successfully launched June 2007

Aug-08 - P 23

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ASTRIUM SERVICES


Welfare telephone and internet services for more than 10,000 French troops based overseas

PASSERELWelfare services to French troops overseas

� Infrastructure entirely financed by Astrium Services

� End-to-end professional and welfare communications services

� Phone points and internet cafes for overseas bases - WiFi services

� Passerel intranet portal for information and credit top up for cards

� Operated via Astrium Services’ Teleport in Toulouse-24/7 support in French and English

Presentation PPP Rome 26 05 - asi.it · Astrium Services PPP : An Innovative Way for Governmental Outsourcing Rome 28th May 2009

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