Spacecom says acquisition talks with Beijing group are still ongoing

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WASHINGTON — Israeli satellite operator Spacecom is denying media reports that it has concluded an agreement to sell itself to the Chinese conglomerate Beijing Xinwei Technology Group, claiming instead that talks are still ongoing.

In response to local press reports that the company’s price tag had dropped from the $285 million agreed upon in August to $190 million after the loss of Amos-6, Spacecom said in a Dec. 5 statement that Xinwei and the operator have yet to settle definitive terms for the renegotiated sale, and ultimately might not be able to save the deal.

The original purchase was contingent upon the successful launch of Amos-6, a sizeable Ka- and Ku-band satellite designed to have more capacity than Spacecom’s Amos-2 and Amos-3 satellites combined. The satellite was destroyed Sept. 1 when its SpaceX Falcon 9 launcher exploded on the pad, throwing the sale of the company into jeopardy.

Spacecom recently forged an agreement with Hong Kong-based AsiaSat to relocate its newest satellite, AsiaSat-8, to four degrees west, where Spacecom will then lease the Ku-band payload as a surrogate for Amos-6 for at least four years, perhaps five. The operator told SpaceNews Dec. 1 that it is designing a replacement satellite that should make up for the lost Ka-band capacity when it enters service in 2020 or 2021.

Spacecom’s owners, led by the privately held Israeli telecommunications group Eurocom, have been trying for several years to sell the company. A deal with Spain’s Hispasat fell through because of Israeli regulatory issues.

In August, Spacecom said it had agreed to sell itself to Xinwei and merge its operations with Luxembourg Space Telecommunication, a Luxembourg subsidiary Xinwei created to serve as the legal entity conducting the Spacecom acquisition.

Here is Spacecom’s full Dec. 5 statement:

Spacecom (TASE: SCC) wishes to inform the public that merger talks with Luxembourg Space Telecommunication S.A., a Luxembourg company and subsidiary of Beijing Xinwei Technology Group, are continuing and there is no final agreement about terms for Spacecom’s acquisition by the Luxembourg company.

Spacecom wishes to clarify that the signing of this deal is contingent upon completing discussions between the sides on certain principles that remain open between the two sides. At present, there is no certainty that the deal in its current condition or with future conditions will or can be signed.