The sale of Netherlands-based New Skies Satellites to US private equity firm Blackstone Group for $956 million in cash is expected to add momentum to the auction of satellite operator Intelsat, which could be worth up to $5 billion.
Blackstone is reportedly interested in Intelsat, but faces competition from US private equity firm Kohlberg Kravis Roberts, which in April paid $3.55 billion for satellite operator PanAmSat, and European private equity groups Apax Partners and Permira, which last year bought Inmarsat for $1.54 billion. The bidders see consolidation as the only way to tackle overcapacity in the satellite services sector.
New Skies, set up by Intelsat in 1998, has only five satellites. Blackstone, meanwhile, was unsuccessful in its bid for PanAmSat, which operates 29 satellites. PanAmSat was sold after its majority shareholder, satellite operator DirecTV, was taken over by News Corp last December.
Intelsat, which operates 27 satellites, began talks with private investors last month after abandoning a planned public offering.
Source: Flight International
