European aerospace manufacturers Airbus, Leonardo, and Thales have finalized a deal to combine their space divisions into a new joint business. The entity will be headquartered in France and is intended to create a European rival to SpaceX.
The new, yet-unnamed company will employ approximately 25,000 people. Ownership of the venture will be divided, with Airbus holding a 35 percent stake, while Leonardo and Thales will each hold a 32.5 percent share. Executives aim for the company to serve Europe’s strategic need for “sovereignty” in space. A primary objective is the creation of a competitive alternative to SpaceX’s Starlink communications network. An increased presence in space is also viewed as beneficial for the continent’s security and defense objectives, according to reporting by the Financial Times.
Thales, Leonardo and Airbus have signed a Memorandum of Understanding aimed at creating a leading European player in space. 🇪🇺
Read the full announcement here: https://t.co/bbhPWU5hWd#Europe #Space @Airbus @Leonardo_live @Thales_Alenia_S @Telespazio @AirbusSpace @LDO_Space pic.twitter.com/iz8IsChAhb
— Thales Group (@thalesgroup) October 23, 2025
In a joint statement, the companies outlined the strategic foundation for the merger. “This proposed new company marks a pivotal milestone for Europe’s space industry. It embodies our shared vision to build a stronger and more competitive European presence in an increasingly dynamic global space market,” the statement explained. “By pooling our talent, resources, expertise and R&D capabilities, we aim to generate growth, accelerate innovation and deliver greater value to our customers and stakeholders.”
The business will operate as a standalone company, structured similarly to a well-financed startup. The agreement brings together Thales and Airbus, which have historically been rivals in the satellite market, alongside Leonardo, recognized for its work in space systems and services. Leadership confirmed that no site closures are planned, and each participating company will retain its existing national facilities and industrial capabilities. Reporting indicates the new entity’s initial primary task will be to develop more efficient processes for the development and manufacturing of satellites.
Discussions surrounding the formation of this joint business have been ongoing since 2019. The finalization of the deal is still contingent upon receiving approval from regulatory authorities. The partner companies have stated their expectation that the new entity will be fully operational by 2027, pending the completion of the regulatory review process.
Starship reenters Earth’s atmosphere on Flight 11. Data gathered from this flight will inform future Starship missions that will return to the launch site for catch and reuse pic.twitter.com/34WV9ZVtAA
— SpaceX (@SpaceX) October 17, 2025
While the European entity is being formed, its competitor SpaceX is engaged in the development of a next-generation version of its Starship super-heavy lift vehicle. SpaceX is also in the planning stages for a manned mission to the moon, a project that recently experienced a setback which could lead to a lengthy delay.
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