Beijing Xinwei Telecom Technology, a company owned by Chinese tycoon Wang Jing, is set to acquire and take over the operation of an Israeli satellite firm for $285 million, China Daily reported.
According to Wang, the deal would provide the company access to "scarce resources" in outer space, with the decrease in the number of available positions on some satellite orbits.
Wang was first recognized for his idea to build the $50-billion canal project in Nicaragua that will link the Pacific and Atlantic Oceans.
In a statement released on Wednesday, Aug. 24, the Chinese tech company said that it will acquire 100 percent stake in Spacecom Satellite Communications through its unit, Luxembourg Space Telecommunications.
"After the acquisition, we will be able to provide services to 95 percent of the world's people and gain a professional team with 20 years' experience in satellite operations," the statement said.
Xinwei will be the first private company to gain access to scarce orbit resource, which according to a researcher at the China Academy of Space Techonology is mainly controlled and managed by the military.
"This access is a really valuable asset, because the number of available slots on high Earth orbits is quite limited, and only a few permits are granted each year to countries around the world for the launch of satellites," the researcher who refused to be named said.
An orbit higher than 36,000 km around the Earth is referred to as high Earth orbit, the report said.
"The United States and Russia dominate the satellite market in terms of manufacturing and operating, and this deal will unlock the potential for Chinese satellite companies," the researcher said.
For Beijing Xinwei, however, the deal was not its first venture in the industry. The firm specializes in mobile network development and space industry products.
In 2013, the company, together with Tsinghua University, developed and launched a satellite that provides foreign satellite communication providers in China's ocean and desert regions with low-priced alternative.
Meanwhile, Spacecom, which was established in 1989, operates several Israeli communication satellites called AMOS. It caters its services to clients that included broadcasters, communication companies, telecom providers and government agencies. Its satellites cover Africa, Asia, Central Europe and the Middle East.
The Israeli company is also planning to build an Amos 6 satellite for Facebook that will enable mobile phones to have direct access to broadband services.