Inmarsat has been sold in £2.6bn deal with Triton Bidco

Inmarsat Aviation signInmarsat has been sold for £2.6bn to a consortium led by Apax Partners after lodging a formal takeover bid last week.

The consortium, known as Triton Bidco, includes Apax Partners, Warburg Pincus and the Canada Pension Plan Investment Board. It first approached Inmarsat at the end of January about a possible takeover.

The consortium’s $7.21 (£5.43) a share offer amounts to a 46pc premium to the share price on Jan 30 before takeover talks emerged.

In a statement Triton Bidco said it believes that “the satellite sector is attractive, with unique characteristics, including long lead times and the need for deep technical expertise, while operators in the sector require strategic management and a long investment horizon. Triton Bidco believes that integrated satellite operators with scale like Inmarsat are well positioned as network provision becomes more complex”.

Inmarsat will therefore become a private company again after more than a decade on the stock market.

Inmarsat’s share price has faltered recently. From a high of £11.37 in December 2016 it has fallen to a low of £3.62 in March 2018. More recently, the price has rallied somewhat on news that other companies are interested.

Inmarsat recently delivered its 2018 results, showing good growth in revenue, with year-on-year increases of 5.3% and more than double inflight connectivity revenues.

Group Revenue (ex Ligado) for 2018 increased by $71.6m, or 5.7%, to $1,334.5m, including $26.6m increase in Q4.

Inflight connectivity (IFC) revenues more than doubled to $101.3m, including the first GX IFC airtime revenues.

Rupert Pearce, Chief Executive Officer, said then: “We remain focused on building and defending substantial market share in our target markets, supported by our diversified product portfolio and leading-edge networks. This will ensure we are able to fully capitalise on both the immediate and longer-term growth opportunities in these markets.

“Supported by a tightly controlled cost base and an infrastructure capital investment programme which we are confident will meaningfully and sustainably moderate from 2021, we expect to generate sustained free cash flow growth over the medium to long term.”

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