SES and Intelsat in talks for merger

Satellite operator SES and Intelsat negotiate merger

SES and Intelsat, two of the largest satellite operators, are in talks regarding a possible merger. SES confirmed the discussions on Wednesday, but it’s unclear whether an agreement will be reached. SES has over 70 earth satellites in various orbits, making it unique, while Intelsat’s operations center is located in the US, despite being based in Luxembourg.

Intelsat’s financial woes led to bankruptcy protection in 2020, which granted them a debt burden reduction from $16 billion to $7 billion, while also gaining access to $6.7 billion of new funding. However, it’s still unclear how the company is faring financially since it’s no longer publicly traded.

SES, on the other hand, had a turnover of €1.94 billion in 2022, with sales of approximately €1 billion coming from SES Video and €923 million from SES Networks. Operating profit declined by 70% to €11 million, leading to a net loss of €35 million in 2022 after a net profit of €446 million the previous year. SES also had a debt of €3.9 billion at the turn of the year.

Both SES and Intelsat will receive payments from the US due to their renouncement of frequency usage rights in favor of 5G mobile networks, amounting to $9.7 billion. There’s also several billion dollars to be reimbursed for necessary technical measures. It remains to be seen whether the merger discussions will result in a final agreement.

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