London-based satellite operator Inmarsat is a global success story, but for the past year or two its share price has benefited from a perceived move towards consolidation by Philip Falcone, the US hedge-fund boss. His company, Harbinger Capital owns just under 30% of Inmarsat, and it had been thought that Falcone’s intentions were to acquire more and roll the company into Harbinger-owned SkyTerra Communications. SkyTerra is developing a giant mobile, high-capacity broadband network for the USA.
However, it seems that Harbinger has gone cold on the merger scheme, and Inmarsat’s share price is suffering. It fell a further 9.5p today, 1.4% (Oct 4), but the tumble has been fairly constant since it hit its ‘high’ of 821p back in July.
It also seems that Falcone wants Inmarsat to place a new tranche of shares onto the market, equal to 10% of the company’s existing capital. As well as putting some cash into Inmarsat’s coffers, this would see Harbinger sell off about one third of its own holdings, while at the same time inevitably depressing the overall share price because of the new issue. Falcone needs the cash in order to build out 36,000 new terrestrial base stations with a 4G mobile network, and has just signed up a deal with Nokia/Siemens as its hybrid network partner for the scheme.