BC Partners to
Acquire Majority of Intelsat
(19 June 2007) Intelsat, Ltd., the
world's leading provider of fixed satellite services, today announced the
signing of a definitive agreement for the purchase of a majority of the shares
of its parent company, Intelsat Holdings, Ltd., by funds advised by BC Partners
and certain other investors.
The BCEC funds-led group will
acquire approximately 76% of the primary ownership of Intelsat Holdings, Ltd.
in a transaction valuing the company's equity at approximately US$ 5.03
billion. Taking into account approximately US$ 11.4 billion of debt as of March
31, 2007, the enterprise valuation implied by the transaction is approximately
US$ 16.4 billion. The current shareholders of Intelsat, including funds advised
by Apax Partners, Apollo Management, Madison Dearborn Partners, Permira and
management, are expected to receive upon closing approximately US$ 4.6 billion
in cash, and will continue to hold approximately 24% of the primary ownership
of Intelsat Holdings, Ltd.
Intelsat CEO Dave McGlade said, "This
transaction highlights the significant value that Intelsat has created for its
shareholders and the tremendous opportunities the business and employees will
enjoy going forward. The company has thrived under private equity ownership,
including the 2006 completion of the transformative PanAmSat combination that
firmly established Intelsat's global leadership position. As a result, we have
a keen appreciation for the financial and strategic support that a firm such as
BC Partners can provide. We are confident that they will continue to endorse
Intelsat's objectives for revenue growth and operating
improvements."
"Intelsat and the FSS sector are in the midst of a cycle
of strong performance," said Raymond Svider, a Managing Partner of BC Partners.
"Intelsat is the premier FSS satellite operator, with high-quality assets and a
strong global brand. Its valuable cable and direct-to-home neighbourhoods,
strength in network applications, blue chip customer base and solid backlog of
long-term contracts create an attractive investment opportunity. We look
forward to working with and supporting Intelsat's management team as they
pursue their growth strategies."
Mr. McGlade is expected to continue to
serve as Chief Executive Officer of the company, which will remain focused on
serving its global customer base in the media, network services and government
sectors.
Closing of the transaction is expected to occur within six to
nine months, upon the satisfaction of customary conditions, including
appropriate regulatory approvals. As a result of the anticipated financings,
the company's debt is expected to increase by approximately US$ 3.85 billion at
closing. BC Partners has obtained financing commitments from a group of
financial institutions led by affiliates of Credit Suisse, Banc of America
Securities and Morgan Stanley for US$ 5.11 billion, the proceeds of which will
be used to fund the transaction, repay certain indebtedness and pay certain
transaction fees and expenses. This debt will be assumed by a new entity junior
to Intelsat (Bermuda), Ltd. As part of the transaction, the Company expects to
retire approximately US$ 860 million of existing debt at Intelsat (Bermuda),
Ltd. and to defease or retire the US$ 400 million Intelsat, Ltd. 5.25% Senior
Notes due 2008.
Credit Suisse is acting as financial advisor to Intelsat
in connection with the transaction. Intelsat's legal advisors include Wachtell
Lipton Rosen & Katz, Wiley Rein, and Paul, Weiss, Rifkind, Wharton &
Garrison. Merrill Lynch & Co. and Perella Weinberg Partners LP are acting
as M&A advisors, Latham & Watkins LLP as legal advisor and
PricewaterhouseCoopers LLP as financial advisor to BC Partners.
About
Intelsat
Intelsat is the leading provider of fixed satellite services
(FSS) world-wide, serving the media, network services and government customer
sectors, enabling people and businesses everywhere constant access to
information and entertainment. Intelsat offers customers a greater business
potential by providing them access to unrivalled resources with ease of
business and peace of mind. Our services are utilized by an extensive customer
base, including some of the world's leading media and communications companies,
multinational corporations, Internet service providers and government/military
organisations. Real-time, constant communication with people anywhere in the
world is closer, by far.
About BC Partners
BC Partners is a
leading international private equity firm, operating through integrated teams
based in Geneva, Hamburg, London, Milan, New York and Paris. The latest fund
BCEC VIII closed in May 2005 with Euro 5.9bn of commitments. Over 20 years the
firm has developed a long track record of successfully acquiring and developing
businesses in partnership with management, investing in 63 acquisitions with a
combined enterprise value of Euro 47.7bn. Recent investments include Brenntag
(Germany, turnover on acquisition Euro 6bn), Amadeus (Spain, Euro 4.6bn),
Dometic (Sweden, Euro 1.1bn), Picard (France, Euro 1.3bn), SEAT Pagine Gialle
(Italy, Euro 5.7bn) and Unity Media (Germany, Euro 3.1bn).
(source:
Intelsat)