Intelsat purchase of Loral satellites moves towards completion
Posted: Wed, Nov 12, 2003, 1:39 PM ET (1839 GMT)
A deal by Intelsat to acquire five Loral satellites could close by the end of this year, Intelsat officials said late Tuesday. The company noted in a release that the window for appealing a bankruptcy judge's approval of the deal last month closed with no appeals filed. Intelsat officials said that the lack of appeals could allow the deal for the Telstar 5, 6, 7, 8, and 13 satellites to close as early as the end of this year. The major hurdle for closing the deal is winning FCC approval for transferring the licenses for those satellites from Loral to Intelsat. The deal is valued at a maximum of $1.1 billion, but Intelsat said that the actual price could go down, depending on any net insurance proceeds received by Loral for a $141-million claim on the loss of Telstar 4, a satellite originally included in the deal but which failed in orbit in September. The price could also go down based on unspecified "revenue and backlog-related performance thresholds." Loral sold the satellites, which all serve the North American market, to Intelsat to pay off creditors as part of its Chapter 11 restructuring. In a separate statement Tuesday, Loral announced that one of the satellites to be sold to Intelsat, Telstar 13, had entered service. The spacecraft, co-owned with EchoStar and also known as EchoStar 9, was launched in August.
A deal by Intelsat to acquire five Loral satellites could close by the end of this year, Intelsat officials said late Tuesday. The company noted in a release that the window for appealing a bankruptcy judge's approval of the deal last month closed with no appeals filed. Intelsat officials said that the lack of appeals could allow the deal for the Telstar 5, 6, 7, 8, and 13 satellites to close as early as the end of this year. The major hurdle for closing the deal is winning FCC approval for transferring the licenses for those satellites from Loral to Intelsat. The deal is valued at a maximum of $1.1 billion, but Intelsat said that the actual price could go down, depending on any net insurance proceeds received by Loral for a $141-million claim on the loss of Telstar 4, a satellite originally included in the deal but which failed in orbit in September. The price could also go down based on unspecified "revenue and backlog-related performance thresholds." Loral sold the satellites, which all serve the North American market, to Intelsat to pay off creditors as part of its Chapter 11 restructuring. In a separate statement Tuesday, Loral announced that one of the satellites to be sold to Intelsat, Telstar 13, had entered service. The spacecraft, co-owned with EchoStar and also known as EchoStar 9, was launched in August.
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