Intelsat (NYSE:I) and OneWeb have entered into a definitive combination agreement pursuant to which Intelsat and OneWeb will merge in a share-for-share transaction, the companies said.
Intelsat and SoftBank Group Corp. also agreed that SoftBank will invest USD 1.7bn in newly issued common and preferred shares of the combined company.
Both the merger and the SoftBank investment are subject to successful completion of debt exchange offers to certain existing Intelsat bondholders as well as receipt of certain regulatory approvals.
The debt exchange offers, announced today, together with the proceeds of the SoftBank investment are intended to reduce Intelsat´s debt by approximately USD 3.6 billion, assuming the minimum level of participation in the debt exchange offers is achieved.
Either party can terminate the agreement and SoftBank can terminate its investment if the debt exchange offers have not been successfully completed within 90 days of the date of the agreement.
The combined company will remain domiciled in Luxembourg, and continue to be listed on the New York Stock Exchange. It will maintain a significant presence in the United States, including at OneWeb´s new manufacturing facility in Exploration Park, Florida, and at Intelsat´s United States facilities in McLean, Virginia.
The transaction is expected to close late in the third quarter of 2017.
Guggenheim Securities, LLC and Goldman, Sachs & Co. acted as financial advisors and Wachtell, Lipton, Rosen & Katz and Elvinger Hoss and Prussen provided legal counsel to Intelsat.
PJT Partners acted as lead financial advisor to OneWeb and also advised SoftBank. Barclays acted as a financial advisor to OneWeb and rendered a fairness opinion. Morrison & Foerster LLP, Arendt and Medernech, and Mourant Ozannes provided legal counsel to OneWeb and SoftBank, and Choate Hall & Stewart LLP and Milbank, Tweed, Hadley & McCloy provided legal counsel to OneWeb.
Intelsat S.A. (NYSE:I) operates a globalized network, delivering high-quality, cost-effective video and broadband services anywhere in the world.
OneWeb´s mission is to enable affordable Internet access for everyone, to connect all the unconnected schools of the world, and to fully bridge the digital divide by 2027.
The SoftBank Group is a global technology player that aspires to drive the Information Revolution. The SoftBank Group is comprised of the holding company SoftBank Group Corp. (TOKYO: 9984) and its global portfolio of companies, which includes advanced telecommunications, Internet services, AI, smart robotics, IoT and clean energy technology providers.