Global communications company Viasat has announced the completion of its long-proposed £5.4 billion takeover of UK-based maritime telecommunications group Inmarsat.
The closing of the acquisition enables the companies to combine spectrum, satellite and terrestrial assets, including a network of 19 satellites in space. According to Viasat, "these complementary assets are expected to deliver connectivity and key safety services across maritime, aviation, government and consumer markets with speed and reliability of connection front of mind."
The group will continue to be led by existing chairman and CEO Mark Dankberg and Guru Gowrappan as President, with its corporate headquarters remaining in Carlsbad, California. Inmarsat CEO Rajeev Suri and chairman Andy Sukawaty will join the Viasat board of directors as representatives of the prior Inmarsat private equity ownership consortium.
“We are thrilled to welcome Inmarsat’s employees, customers, shareholders and partners into the Viasat ecosystem,” Dankberg said of the announcement. "Together, we believe we are positioned to offer customers a multi-layered network that gives them the right connectivity at the right time, place and price."
In a previous statement, Dankberg added that the deal will also help to create new high-skill technology jobs and deepen the American firm's capabilities in the UK.
“Satellite communications is a hugely significant and strategic global market for the UK space sector, now poised for an exciting next phase,” said George Freeman, UK minister of state at the Department of Science, Innovation and Technology. "The combination of Viasat and Inmarsat creates a global leader in satellite communications here in the U.K. It brings significant investment, hundreds of new highly skilled jobs and will serve as a catalyst for substantial economic growth."
Under the terms of the purchase agreement, Inmarsat’s shareholders received an aggregate of $551 million in cash upon the transaction's close, subject to adjustments, and approximately 46.36 million shares of common stock. The shares represent an aggregate of approximately 37.6 per cent of the total shares of Viasat common stock on a fully diluted basis, with no Inmarsat shareholder receiving shares representing 10 per cent or more.
Inmarsat has been heavily involved in the maritime communications sector, with its high-speed mobile broadband service FleetXpress used by more than 13,000 private and commercial ships. In 2020, the service provider issued a study finding that VSAT usage is expected to grow by 42 per cent by 2025.
The proposed transaction received prior clearance from the UK government under the National Security and Investment Act and the CMA, as well as the Australian government's Foreign Investment Review Board (FIRB) and the Committee on Foreign Investment in the United States.
The announcement from Viasat also marked the completion of an investigation opened by the European Commission, which expressed concerns earlier this year that the integration of Inmarsat and Viasat would create a monopoly on satellite communications with little room for competitors. On 25 May, the Commission issued its "unconditional approval" for the deal to proceed under the EU Merger Regulation, with news of the completed acquisition following one week later.