SES To Acquire Intelsat For $3.1 Billion

Republished By Plato

Followers: 0

WASHINGTON — SES is acquiring rival satellite operator Intelsat for $3.1 billion, a deal that would bring together two of the major GEO satellite operators in a market facing increased competition from LEO constellations.

The companies announced April 30 that they had agreed on the deal, subject to regulatory approvals. SES will pay $3.1 billion in cash along with certain contingent value rights for 100% of Intelsat. The transaction is not expected to close until the second half of 2025.

SES said it will fund the deal through existing cash on hand, which it estimates to be $2.6 billion at the end of March, along with debt. The combined company would have about $4.1 billion in annual revenues. The combined company will remain headquartered in Luxembourg, where SES is based, but will maintain a “significant presence” at Intelsat’s home in the Washington, D.C., area.

“In a fast-moving and competitive satellite communication industry, this transaction expands our multi-orbit space network, spectrum portfolio, ground infrastructure around the world, go-to-market capabilities, managed service solutions, and financial profile,” Adel Al-Saleh, chief executive of SES, said in a statement.

“Over the past two years, the Intelsat team has executed a remarkable strategic reset,” said David Wajsgras, chief executive of Intelsat, in that statement, a reference to the company’s emergence from Chapter 11 bankruptcy reorganization. “By combining our financial strength and world-class team with that of SES, we create a more competitive, growth-oriented solutions provider in an industry going through disruptive change.”

The deal brings together operators of two of the largest operators of commercial GEO communications satellites, a sector that once was the most lucrative part of the space industry but has been under increased pressure from reduced demand from conventional television services and the rise of LEO constellations, like SpaceX’s Starlink, offering connectivity services. The two companies have more than 100 GEO satellites combined, along with the medium Earth orbit O3b constellation from SES

There had been rumors in the last two years that SES and Intelsat would combine, and SES confirmed in March 2023 the two companies had been in talks. However, three months later Intelsat walked away from those discussions after the companies couldn’t resolve differences.

The deal is part of a wave of consolidation in the satellite communications sector that in recent years has included Viasta’s acquisition of Inmarsat and Eutelsat’s acquisition of OneWeb.