In-Flight Entertainment (IFE) and broadband-to-aircraft specialists Gogo is reportedly in “advanced talks” to bring in a new investor and help reduce the company’s debt burden.
According to trade news-site Space Intel Report a deal is expected to be concluded in May.
Gogo’s CEO Oakleigh B. Thorne said a new investor was preferable to selling off one the company’s divisions.
As at January 1st Gogo had some $1.03 billion of total debt and borrowings, and was working to clear $162 million in debt in the form of convertible notes, due to be repaid in March 2020.
The company also said that they backed industry-wide consolidation in the IFE space. One of the challenges the sector faces is having to fund the full or partial installation of equipment on board aircraft ahead of any revenues flowing from passengers.
Gogo is serving around 1000 commercial aircraft with its Ku-band system and has a backlog of another 1000 jets. However, overall Gogo is serving 5224 aircraft, up 11.7 per cent on 2017.
The passenger take-up rate of Gogo services over North America is growing nicely. Take-up was 12.9 per cent during the last three months of 2018, up from 12 per cent in the previous quarter-year, and 9.9 per cent in the same period in 2017.