US-based satellite company Viasat is to acquire UK rival Inmarsat in a deal valuing the latter at $7.3 billion, aiming to create a global market leader with a fleet of 19 operating satellites and additional ten spacecraft due for launch in the next three years.
In a joint statement, the pair argued the deal will help the newly combined player gain enhanced scale and scope to deliver affordable and secure connectivity around the world.
The entity is set to deliver “advanced new services” in mobile and fixed segments, “driving greater customer choice in broadband communications and narrowband services” including IoT.
The combined company will also offer a broad portfolio of spectrum licenses across the Ka-, L- and S-bands.
Following the deal, Viasat unveiled plans to build on Inmarsat’s presence in the UK and work with the government to create new space capabilities, technologies and jobs in the country.
Inmarsat has been making waves in the mobile sector. In February former Nokia boss Rajeev Suri took the helm, quickly followed by the appointment of ex-Nokia CMO Barry French to a similar role at Inmarsat.
The company is working with India operator BSNL after the telco secured the necessary regulatory clearance to deliver the satellite provider’s mobile broadband services to customers across government, aviation and maritime sectors.
Inmarsat’s push in India follows a recent announcement to combine its existing system with a Low Earth Orbit (LEO) constellation and 5G assets to create a single network targeting corporate customers, as the connectivity space race continues to hot up.
Inmarsat CEO Rajeev Suri noted the acquisition by Viasat as coming “at the right time”, as it is expected to create “a strong future” for Inmarsat while offering “greater choice for customers around the world, enhanced scope for partners and new opportunities for employees”.
The transaction is expected to close in the second half of 2022 and the combined entity is tipped to deliver mid-teens percentage revenue growth after creation.
The deal comprises $850 million in cash, about 46.4 million shares of Viasat valued at roughly $3.1 billion and the assumption of Inmarsat’s $3.4 billion net debt.