ViaSat Dons U.K. Fig Leaf To Buy American with Ex-Im Loan

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PARIS — Satellite broadband hardware and services provider ViaSat Inc. on March 13 said it had concluded terms for a $524.9 million direct loan from the U.S. Export-Import Bank to cover the costs of the ViaSat-2 Ka-band satellite to be launched in mid-2016 from Florida.

The loan, which will finance a Carlsbad, California-based ViaSat’s purchase of a satellite from another California company and its launch by yet another Californian, is an example of the creative uses to which export-credit-agency funding can be put in search of favorable loan terms.

The 6,740-kilogram ViaSat-2 satellite is being built by Boeing Space and Intelligence Systems of El Segundo, California and will be launched aboard a Falcon Heavy rocket built and operated by SpaceX of Hawthorne, California.

The fig leaf needed to secure the deal (which is not the first of its kind) is a heretofore unknown ViaSat subsidiary in Dorset, England – ViaSat Technologies Ltd. – which is the Ex-Im Bank’s counterparty.

Under the terms of the loan, $476 million may be used to finance up to 85 percent of the costs associated with the construction and launch of ViaSat-2, with the remainder set aside for other expenses associated with the loan.

Repayment, in 17 semi-annual installments, is to start within six months of ViaSat-2’s entry into service. The Commercial Interest Reference Rate in effect during the five days before the first withdrawal will set the interest rate for the deal. That rate is now 2 percent and 2.5 percent annually.