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Telecommunications Iridium refinancing nears completion
Telecommunications Iridium refinancing nears completion | Iridium refinancing nears completion |
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| by Stuart Corner | |
| Sunday, 27 September 2009 | |
  
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Iridium and GHL, sponsored and 17.5 percent owned by Greenhill & Co, announced last week the signing of a definitive agreement under which they plan to combine. GHL has raised $US400m to fund the deal which values Iridium at approximately $US591m. It will see the existing owners retaining about 42 percent of the company, which will be renamed Iridium Communications Inc (It is presently Iridium Holdings LLC). Plans for the deal were announced almost exactly a year ago. Scott L Bok, CEO of GHL Acquisition, said at the time: "Iridium is the fastest-growing full-service voice and data MSS provider and one of only a handful of major players in its industry, which has significant barriers to entry. It has developed substantial scale in terms of revenue and cash flow, and has an impressive track record of growth across each of its five subscriber verticals. At the agreed transaction valuation, Iridium should be a compelling alternative to investors in a fast growing sector with few participants." Matt Desch, CEO of Iridium, said: " Not only will this transaction permit us to have a strong balance sheet and potential future funding from GHL Acquisition's future warrant proceeds, but it will also provide us access to Greenhill's expertise and network of relationships as we develop Iridium into the future. This transaction positions us well to meet and exceed the needs and expectations of our customers, suppliers, employees and stockholders." According to details of the deal given at the time it was announced in September 2008, Current shareholders of Iridium will receive approximately $US77m in cash and 36.0 million common shares. The remaining cash, approximately $US324m, will be available to retire Iridium's current debt of approximately $US131m, pay transaction-related expenses, and for use by Iridium for general corporate purposes and capital expenditures. Iridium operates a fully meshed network of 66 operational cross-linked satellites in polar low-earth orbit and claims to be the only mobile satellite service that provides 100 percent coverage over the entire face of the globe (geostationary satellites in orbit above the equater cannot serve the polar regions.)
This article first appeared in ExchangeDaily, iTWire's daily newsletter for telecommunications professionals. Register here for your free trial.
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