SES has confirmed that it is in advanced talks to combine with rival Intelsat to create a European satellite giant that can better compete with billionaire Elon Musk.
Luxembourg-based SES has confirmed that the company has engaged in discussions regarding a possible combination with Intelsat. “At this stage, there can be no certainty that a transaction would materialise.”
SES is aiming to reach an agreement with Intelsat as soon as the next few weeks. A transaction could value the combined business at more than $10 billion including debt, Bloomberg news report said.
SES has a market value of about €2.6 billion ($2.7 billion). SES has reported revenue of €1.944 billion (+9.1 percent) in 2022. SES is targeting 2023 revenue of €1.95-€2 billion and €1,010-€1,050 million in Adjusted EBITDA.
A combination would help SES bulk up at a time when it’s facing fresh competition. Plans by Elon Musk and fellow tycoon Jeff Bezos to launch thousands of spacecraft into lower orbits and blanket the earth in fast broadband have pushed the traditional satellite industry into mergers.
Luxembourg government is SES’s largest shareholder.
California-based Viasat agreed in 2021 to buy Britain’s Inmarsat Group for about $4 billion in cash and shares. France’s Eutelsat Communications is acquiring OneWeb in a $3.4 billion all-stock deal.
Intelsat emerged from bankruptcy in February last year, cutting its $16 billion debt in half.
SES beams video for broadcasters including Sky TV. It also provides broadband for clients who are remote from traditional internet service, such as cruise ships and planes.