Europe’s Airbus has confirmed an agreement to sell its commercial satcoms business to French private equity firm Apax Partners for an undisclosed sum. The group put the assets up for sale last year amid a far-reaching restructuring process.
Europe’s Airbus (EPA:AIR) has confirmed an agreement to sell its commercial satcoms business to French private equity firm Apax Partners for an undisclosed sum.
They expect to close the deal in the next few months after securing regulatory approvals.
SatelliteFinance reported in July that Apax had beaten strategic and other PE players in bidding for the assets, which are primarily derived from a satcoms firm acquired four years ago called Vizada. Apax sold Vizada to Airbus for US$960m in 2011, when the latter was known as EADS.
It rebranded as Airbus in 2014 and, in September that year, unveiled plans to sell its commercial satcoms business and other noncore assets to simplify its defence and space division, strengthening its focus on warplanes, missiles, launchers and satellites. The move is part of a wider restructuring process to streamline operations and boost its ability to compete with US arch rival Boeing (NYSE:BA).
In August 2015, Airbus Defence and Space said it had agreed to sell its US-based government satcoms unit ASGI to aviation-focused Satcom Direct Communications, also for an undisclosed sum.
Airbus Defence and Space still holds a sizeable government satcoms business elsewhere, built up after more than 10 years to be considered a core part of the group’s activities, and not included in the sale to Apax.
The commercial satcoms assets it is selling cover the maritime and land markets with a presence in 14 countries across Europe, Asia, the Middle East and the Americas. It has a distribution network of about 400 re-sellers and holds partnerships with satellite operators such as the UK’s Inmarsat, which was said at one point to be considering buying it.
Apax partner Bertrand Pivin said: “We are delighted to return to the fast growing mobile satellite communication industry acquiring Airbus Commercial Satellite Communication business who was recently nominated the largest maritime satcoms provider worldwide.
“We will work with Inmarsat and other satellite operators to offer an ever growing range of broadband satcoms solutions to clients worldwide, providing tailored products and services that will help them digitalize their own operations on land and at sea.”
Lazard ran the sales process.
A trend towards consolidation has been sweeping through the fragmented satcoms services industry as firms look to build scale globally to reduce costs. Hong Kong’s SpeedCast (ASE:SDA) has been particularly acquisitive in the sector, making around 10 bolt-on acquisitions since being bought by private equity firm TA Associates in late 2012.
Apax declined to comment on its plan to grow the former Airbus business.
Meanwhile, Airbus has reportedly shortlisted US buyout groups Carlyle and KKR for buying its defence electronics unit.
A consortium comprising German satellite maker OHB and PE firm Cinven, as well as German defence firm Rheinmetall, did not make the cut, reported Reuters citing sources.
Total revenue of all the assets that Airbus Defence and Space put up for sale last year reaches around €2bn (US$2.2bn), or just over 14% of the €14bn in sales that the division made overall.
In 2014, its parent group – comprising Airbus, Airbus Defence and Space and Airbus Helicopters – generated €60.7bn (US$66.5m) in sales and employed a workforce of around 138,600.
