29 December 2002
Satcoms
ViaSat Receives US$ 6 Million Order for e-Mexico National
System
Business
Liberty Satellite, Intelsat, and NRTC Lead US$ 156
Million Investment in WildBlue
XM Radio Announces US$ 450 Million Financing
Package
ViaSat Receives US$ 6 Million Order for e-Mexico National
System
(23 December
2002) ViaSat Inc has been awarded a contract by InterDirec to provide a
LinkStar Broadband VSAT network for the e-Mexico National System, a national IT
project for Mexico.
The contract, valued at
approximately US$ 6 million, calls for the installation of a network hub in
Mexico City and 3,200 to 4,000 LinkStar terminals by March of 2003. The overall
objective of e-Mexico is to build a national IT network that will connect over
90% of Mexico's population with electronic services for distance learning,
internet access, government, health, and commerce.
ViaSat's Comsat
Laboratories division will execute the contract in partnership with InterDirec,
a communications service provider based in Mexico.
LinkStar is a
hub-based VSAT system that provides two-way, broadband-on-demand services.
Remote LinkStar terminals receive data from a shared, 60 Mb/s broadcast from
the access hub, and can transmit back to the hub at up to 1.15 Mb/s. ViaSat
interactive VSATs use a common, digital video broadcast (DVB-S) standard-based
hub, so a single network supports a variety of video and internet protocol data
traffic.
Mexican President Vicente Fox launched the first phase of
e-Mexico in July to develop Mexico's IT and communications (ITC) industry,
foster an internal market for ITC products, promote an adequate regulatory
framework for the use of electronic media and e-commerce, and digitise
government services. The initial goal is to provide connectivity to the general
population through the installation of 3,000 to 4,000 Digital Community Centers
housing government offices such as the post office and health and education
centres. The ultimate goal of e-Mexico is to build and connect 10,000 Digital
Community Centers to a national network, benefiting more than 98% of the
population of Mexico. The e-Mexico infrastructure is expected to increase
Internet users in Mexico from 4.5 million to 60 million.
Cosmos
2293
Launched: 24
December 2002
Site: Plesetsk Cosmodrome, Russia
Launcher: Molniya-M
Orbit: Molniya, apogee: 39,098 km, perigee: 507 km: inclination: 62.9°
International Number: 2002-059A
Name: Cosmos 2293
Cosmos 2293 is a
Russian military missile warning satellite.
Glonass
Launched: 25 December
2002
Site: Baikonur Cosmodrome, Kazakhstan
Launcher: Proton K
Orbit: LEO
International Number: 2002-060A, B, C
Name: Glonass (3
satellites)
This launch placed three Russian Glonass navigation
satellites in orbit.
Liberty
Satellite, Intelsat,
and NRTC Lead US$ 156 Million Investment in WildBlue
(23 December 2002) Liberty Satellite &
Technology Inc, Intelsat, National Rural Telecommunications Co-operative
(NRTC), Kleiner Perkins Caufield & Byers, and David Drucker, WildBlue's
chairman, have agreed to invest US$ 156 million in WildBlue Communications.
Liberty Satellite, Kleiner Perkins and David Drucker are
existing shareholders. Intelsat and NRTC are new investors in WildBlue and will
join the board of directors as part of this investment. This transaction is
subject to WildBlue meeting certain conditions, including FCC approvals.
WildBlue expects the investment to close in the second quarter of 2003.
WildBlue will deliver affordable two-way wireless broadband services via
satellite, direct to homes and small offices, throughout the contiguous United
States in 2004. WildBlue is expected to be the first to launch the Ka band spot
beam satellite technology designed to lower the cost of providing consumers
high-speed Internet access via satellite. The WildBlue system also will
leverage proven terrestrial cable modem technology, resulting in lower customer
equipment and installation costs, a critical requirement in satellite-based
consumer services. WildBlue's service should be especially appealing to the
millions of homes and small offices that lack access to DSL or cable modem
service.
WildBlue initially will offer its services using its license
for the US Ka band payload aboard Telesat Canada's Anik F2 satellite, being
built by Boeing and scheduled to launch in late 2003 into the 111.1° W
orbital location. Based on future financing, WildBlue plans to subsequently
launch its own satellite, WildBlue-1, being manufactured by Loral Space
Systems, into WildBlue's 109.2° W orbital location. Andrew Corporation has
been contracted to construct WildBlue's earth gateways.
XM
Radio Announces US$ 450
Million Financing Package
(23 December 2002) XM Satellite Radio Inc has
announced a set of definitive financing agreements totalling US$ 450 million -
consisting of US$ 200 million in new funds from strategic and financial
investors and US$ 250 million in payment deferrals and related credit
facilities from General Motors.
The US$ 200 million in
new funding is in the form of 10% Senior Secured Discount Convertible Notes due
in 2009 and a small concurrent common stock sale. Purchasers of the Notes
include American Honda Motor Co Inc, Hughes Electronics Corporation, The Hearst
Corporation, Columbia Capital LLC, AEA Investors Inc, Eastbourne Capital
Management LLC, BayStar Capital II LP, and other parties. The Notes are
convertible into common stock at a price of US$ 3.18 per share. Proceeds will
be used for general corporate purposes.
In the other major element of
the financing package, General Motors, which is currently factory-installing XM
radios in 25 different 2003 vehicle lines, has agreed to defer or finance up to
US$ 250 million of payments through 2006. The US$ 250 million financing
consists of (i) the exchange of approximately US$ 115 million in fixed payments
due to GM through 2006 for US$ 89 million of 10% Senior Secured Convertible
Notes due 2009, (ii) a US$ 100 million Credit Facility due 2009 with an annual
interest rate of 6 month LIBOR plus 10% to be used only for payments to GM, and
(iii) the right to satisfy up to US$ 35 million of certain future payment
obligations to GM in stock (at then current market value) rather than cash. In
connection with the US$ 100 million Credit Facility, GM will receive 10 million
common stock warrants at US$ 3.18 per share. The conversion price for the GM
Notes varies from US$ 5.00 to US$ 20.00 per share, depending upon the future
price of XM stock.
In addition to the financing package, the Company
will commence an Exchange Offer on Tuesday, December 24 2002, for all US$ 325
million of its outstanding 14% Senior Secured Notes due 2010 in exchange for
new 14% Senior Secured Discount Notes due 2009, warrants and cash. The
financing package is contingent on at least a 90% participation threshold of
the outstanding Senior Notes participating in the Exchange Offer, which can be
waived by the Company with the concurrence of the investors in the 10% Senior
Secured Discount Convertible Notes and General Motors.
Based on
sales-to-date and projections through yearend, XM expects to have more than
350,000 radios (both retail and OEM) sold and ready for activation by December
31 2002. The actual yearend activated subscriber total (sales which have
resulted in activations) is expected to be between 340,000-350,000. A major
reason for the range is the recent significant increase in the number of XM
radios not activated at the time of retail purchase (currently, approximately
24,000 units) - attributable, XM believes, to the many XM radios being
purchased as Holiday gifts (and, thus, possibly not activated by December 31
2002). XM expects that most of the gift radios not activated by yearend will be
converted into subscriber activations during the first two weeks of January
2003.
XM anticipates all necessary conditions and approvals will be
satisfied by the end of February 2003. Upon closing of the transaction, XM
expects to add two members to its Board of Directors - R Steven Hicks, who
brings 33 years of experience building successful companies in the radio
broadcasting and media industry, and Thomas G Elliott, Executive Vice
President, Automobile Operations of American Honda Motor Co Inc.