Intelsat to Pay $3.2B for PanAmSat

Aug 29, 2005  •  Post A Comment

In a move that would create the world’s largest owner of commercial satellites, Intelsat said Monday that it would pay $3.2 billion for PanAmSat.

The deal, which was approved by the boards of both companies in unanimous votes, would create a satellite powerhouse that does business with everything from cable television programmers to network broadcasters. The company will have a fleet of 53 satellites serving customers in more than 220 countries and territories.

As part of the transaction, privately held Intelsat, which is incorporated in Bermuda and has its headquarters in Washington, will pay $25 a share in cash and either assume or refinance another $3.2 billion in PanAmSat debt.

The newly combined company will retain the Intelsat name, with Intelsat CEO David McGlade retaining the chief executive title while PanAmSat CEO Joseph Wright will become chairman.

The transaction comes about a year after PanAmSat was purchased from DirecTV by three buyout firms-Carlyle Group, Kohlberg Kravis Roberts & Co. and Providence Equity Partners-for nearly $3.6 billion and the assumption of $750 million in debt. In March the firms sold 42 percent of PanAmSat to the public.