[FPSPACE] Comsat failure affects Intelsat purchase
zirconic1 at earthlink.net
Mon Nov 29 20:39:18 EST 2004
"The satellite operator, which was set up at the time of the Cold War as a multi-governmental organization, now acts mainly as a long-distance carrier for telecom companies and runs a private line between the White House and the Kremlin."
Intelsat Satellite Loss Threatens Sale
Monday, November 29, 2004; 9:27 AM
PHILADELPHIA -- A planned $3.1 billion takeover of satellite operator Intelsat Ltd. appears in jeopardy after an electrical problem ruined one of the company's satellites.
Bermuda-based Intelsat said private equity group Zeus Holdings Ltd. had the right to pull out of the deal if the satellite was lost.
Zeus, an investment vehicle formed by private equity firms Apax Partners, Permira, Apollo Management and Madison Dearborn Partners, was evaluating the impact of the satellite's failure, Intelsat said.
Intelsat's three largest shareholders are Lockheed Martin Corp. with a 24 percent stake, Tata Sons of India with a 5.4 percent stake, and France Telecom with a 5 percent stake.
Intelsat said an "electrical distribution anomaly" hit its Americas-7 telecommunications satellite early Sunday morning. It is working with manufacturer Space Systems/Loral to determine the cause of the problem.
The satellite, launched in September 1999, covered the United States, Canada, Central America and parts of South America. Intelsat said it had insured the equipment.
Intelsat currently has 23 satellites in orbit. It leases capacity on two additional satellites owned by other satellite operators in the Asia-Pacific region, according to a regulatory filing by the company earlier this year.
The March filing said the Americas-7 satellite's in-orbit operations were covered under an insurance policy due to expire in September 2004, for an amount in excess of its current net book value.
It is not clear whether Intelsat obtained replacement insurance when the coverage expired. The company was not immediately available to comment.
Even when there is in-orbit insurance for a satellite, the filing said, the insurance would not protect against all losses to the satellite, such as losses resulting from acts of war, and other factors.
The satellite operator, which was set up at the time of the Cold War as a multi-governmental organization, now acts mainly as a long-distance carrier for telecom companies and runs a private line between the White House and the Kremlin.
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