Inmarsat / Apax, Warburg Pincus, CPPIB, OTPP

Inmarsat / Apax, Warburg Pincus, CPPIB, OTPP: Private Equity vs Public Market – Regulatory and Counterbid Thoughts



Publication Date: March 26, 2019


Research Report Overview

A private equity consortium led by Apax announced a recommended offer for Inmarsat at $7.21 cash per share. The firm offer follows the consortium’s proposal announced on 19-Mar-19 and is cum dividend, comprising of $7.09 cash plus Inmarsat’s previously announced final dividend of $0.12 (record: 23-Apr-19, ex-date: 18-Apr-19). The offer will be implemented as a UK scheme of arrangement and the consortium has secured irrevocable undertakings from Lansdowne (11.4%), as well as Inmarsat directors (0.5%). Regulatory hurdles include antitrust in Austria, China, Germany, Russia, the UK and US, and foreign investment approvals in Australia, Germany, India, Italy, Russia and the US (under CFIUS). Shareholder votes are expected to take place by 31-May-19 with a targeted effective date during 4Q’19. The tension between public markets and private equity is at the heart of the offer. The financial sponsors see long term value in the satellite operator, and believe that an offer pitched at about the same level as a strategic one from EchoStar last summer (albeit in cash) will see institutional investors rushing for the exit. Inmarsat faces short-term headwinds in its traditional maritime markets and uncertainty in relation to payments from Ligado. However, the company remains an attractive asset for strategic buyers and potential counterbids are likely to be at least examined by EchoStar and Softbank.


Contents (8 Pages):

1. Private Equity vs Public Markets 2. Regulatory Hurdles 3. Potential Counterbidders 4. Deal Structure and Timing


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Deal Timeline

Inmarsat / Apax, Warburg Pincus, CPPIB, OTPP

June 2019

May 2019

April 2019

March 2019

Deal Announced: March 25, 2019
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