Telesat cancels sale; spin-off for SS/L?
August 5, 2011
Satellite communications company Loral Space & Communications has provided an update on the previously announced initiatives to explore strategic alternatives for Telesat and Space Systems/Loral (SS/L).
According to a company statement, in 2010, Telesat initiated a process to explore strategic alternatives. Among other initiatives, potential purchasers participated in a process to explore a potential acquisition of all or a portion of the shareholders’ interests in Telesat.
The process resulted in several acquisition offers; however, none of these offers was deemed to be acceptable, and, as a result, discussions with the potential purchasers were terminated. Telesat and its shareholders are continuing to explore additional alternatives for Telesat, including potential recapitalisation transactions.
After having evaluated various strategic alternatives for its non-Telesat assets, Loral is now focusing primarily on a potential spin-off of SS/L, Loral’s satellite manufacturing subsidiary.
“There can be no assurance whether or when any transaction involving Loral, Telesat or SS/L will occur,” concludes the statement.
It is understood that Telesat was looking for upwards of $6 billion for the business, and this was considered too high a price for buyers. Both SES and Eutelsat declined to bid for Telesat.