Apax Looks Set to Repurchase Airbus Mobile Satcom Unit
PARIS—Apax Partners of France is negotiating the purchase of Airbus Defence and Space’s mobile satellite communications services division—which Apax sold to Airbus in 2011 – in a deal that is expected to close as early as the end of May, industry officials said.
Officials said Apax and Airbus were nearing closure on the transaction but that it was not impossible that another suitor could arrive with a last-minute bid.
Among possible buyers, mobile satellite services provider Inmarsat of London decided not to enter the bidding out of concerns that European regulators would view the purchase as giving Inmarsat an overly dominant role in the distribution of Inmarsat satellite links, officials said.
Apax and Airbus officials declined to comment on the negotiations.
Airbus announced in late 2014 that it was selling the non-military mobile communications services business as part of a broader consolidation move to focus on core business.
Evert Dudok, head of Airbus’ Communications, Intelligence and Security division, which includes the mobile satellite communications business, said in March that the sale likely would close by mid-year.
Dudok said Airbus would proceed with the divestiture despite the fact that the business to be sold – called Vizada when owned by Apax – reported solid growth in 2014 as in 2013.
Dudok said the former Vizada had booked contracts to provide 600 ships with mobile satellite links in 2014, double the figure for 2013, which was twice the total reported in 2012. Airbus is a regular buyer of satellite bandwidth from Inmarsat and from other satellite fleets using Ka- and Ku-band frequencies.
Mobile satellite communications is a fast-growing area that has attracted the competitive attention of numerous large satellite fleet operators as seagoing vessels of all types seek to provide broadband links to crews and passengers.
The market potential in providing broadband connectivity to merchant fleets, yachts and leisure cruise ships is provoking a shakeup in the sector, which industry officials suggest has only just started.
Emerging Markets Communications in April concluded an agreement to purchase MTN Communications, a maritime broadband provider, in a transaction of undisclosed value that is expected to clear regulatory approval by late June. The two companies’ combined maritime fleet of customers will be 1,600 vessels, plus some 8,000 land-based customers.
Industry officials have said other companies are also being assessed as takeover targets as buyers seek scale. Among those are KVH Industries of Middletown, Rhode Island, which has developed a line of small shipboard antennas for television and data links. KVH has not announced that it is seeking a strategic transaction.
Apax France sold its Vizada unit – one of Inmarsat’s two largest distributors – to Airbus for $960 million. Vizada said at the time that its 2011 revenue would be about 660 million euros, or $726 million at current exchange rates.
Industry officials at the time said it appeared that Airbus overpaid for the Vizada business. A sale back to Apax four years later, depending on its terms, could provide evidence of whether that is the case.
Apax created Vizada following two transactions: its 2006 purchase of France Telecom Mobile Satellite Communications, and its 2007 purchase of Norway-based Telenor Satellite Services.