Acquirer: Intelsat S.A. (Luxembourg); SoftBank Group Corp. (Japan)
Acquired: WorldVu Satellites Limited (Bailiwick of Jersey, Channel Islands)
Value: Approximately US$1.7 billion
Industry: Telecommunications; Aerospace
UPDATE: On June 1, 2017, Intelsat S.A. announced the expiration of “solicitations of consents . . . expired without sufficient tenders having been received to satisfy the minimum tender conditions, and accordingly that the Exchange Offers and Consent Solicitations have been terminated.” (Intelsat S.A. Form 6-K, June 1, 2017, SEC Filing.) “As a result of the termination of the Exchange Offers, Intelsat currently expects that OneWeb and SoftBank will exercise their respective termination rights under the Combination Agreement and related Share Purchase Agreement on June 2.” (Press Release, Intelsat S.A., Form 6-K, Ex-99.1, June 1, 2017, SEC Filing.) Under the proposed combination, “SoftBank [would have owned] 39.9% of the outstanding voting common shares of the combined company,” and the transaction was subject “to receipt of clearance from the Committee on Foreign Investment in the United States.” (Excerpts from confidential offering memoranda dated May 17, 2017, Intelsat S.A. Form 6-K, Ex-99.1, May 18, 2017, SEC Filing.) “On June 2, 2017, Intelsat received a termination notice from OneWeb pursuant to which OneWeb terminated the Combination Agreement pursuant to Section 9.1(e) thereof and a termination notice from SoftBank pursuant to which SoftBank terminated the Share Purchase Agreement pursuant to Section 7.1(e) thereof.” (Intelsat S.A. Form 6-K, June 2, 2017, SEC Filing.)
Posted March 2, 2017
Status: Upcoming/New Filing
On February 28, 2017, Intelsat S.A., a Luxembourg corporation and provider of critical communications infrastructure to customers in the network services, media and government sectors, and WorldVu Satellites Limited, which operates as “OneWeb” and is a Low Earth Orbit (LEO) global communications company based in Britain’s Channel Islands, announced they have entered into an agreement whereby WorldVu Satellites will merge into Intelsat. (See Intelsat Press Release, Intelsat Announces Fourth Quarter and Full-Year 2016 Results, Feb. 28, 2017; see also Space News, WorldVu, a Satellite Startup Aiming To Provide Global Internet Connectivity, Continues to Grow Absent Clear Google Relationship, Sept. 3, 2014.) According to Intelsat’s Press Release, “SoftBank Group Corp. (“SoftBank”), which currently owns 43% of the equity of OneWeb, is expected to invest an additional $1.7 billion in newly issued common and preferred equity of the combined company to support the acceleration of the combined company’s growth strategies and strengthen the Intelsat capital structure.” Under the Combination Agreement, “a new Luxembourg holding company will become the parent company of the OneWeb group (such parent company or WorldVu Satellites Limited, as applicable, “OneWeb”) and OneWeb will then merge with Intelsat, with Intelsat being the surviving public company.” (Intelsat Form 6-K, Feb. 28, 2017, SEC Filing.) On the same date, “Intelsat entered into a share purchase agreement (the “Share Purchase Agreement”) with SoftBank Group Corp. (“SoftBank”), pursuant to which SoftBank will make a $1.73 billion cash investment in the combined company. . . in connection with the closing of the Merger.” (Id.) Clearance from the Committee on Foreign Investment in the United States (CFIUS) is a condition of the Combination Agreement between Intelsat and WorldVu Satellites Limited (See Sections 7.5(e), 8.1(d), Combination Agreement, Intelsat Form 6-K, Ex-99.1, Feb. 28, 2017, SEC Filing), and it is a condition of Share Purchase Agreement involving SoftBank Group. (See Sections 5.5(e), 6.1(d), Share Purchase Agreement, Intelsat Form 6-K, Ex-99.2, Feb. 28, 2017, SEC Filing.