Today (December 3rd) is the start of a two-day London High Court hearing which should have seen a routine approval of the agreed buy-out of Inmarsat by a consortium including Apax Partners, Warburg Pincus, Canada Pension Plan Investment Board and Ontario Teachers’ Pension Plan Board.
However, the hearing is far from automatic in that a group of small shareholders are holding out for more cash and saying that the $3.4 billion (at $7.21 a share) on the table from the consortium does not take into account the potential value of Inmarsat’s relationship with Ligado Networks.
Virginia-based Ligado has an agreement in place with Inmarsat to lease spectrum from the satellite operator for a proposed 5G system across the US.
The buyout consortium (Connect Bidco), in statement to the London Stock Exchange, said that the $7.21 per share on offer represents a 46 per cent premium to Intelsat’s share price. “Bidco factored in various potential risks and opportunities in Inmarsat’s business, including in relation to Ligado. Bidco continues to believe that the Offer provides a compelling and deliverable opportunity for Inmarsat Shareholders to receive liquidity at this substantial premium,” said their statement, adding that the cash on the table is “final and will not be increased”.
The consortium also warned the objectors that any further delay “may present an unnecessary period of uncertainty for the business and operations of Inmarsat, which may have an impact on the value of the business.”