Aireon, the satellite-based air traffic management joint venture between MSS operator Iridium and Nav Canada, has entered into binding agreements with three new investors.
Air navigation service providers ENAV of Italy, the Irish Aviation Authority…
Aireon, the satellite-based air traffic management joint venture between MSS operator Iridium and Nav Canada, has entered into binding agreements with three new investors.
Air navigation service providers ENAV of Italy, the Irish Aviation Authority (IAA) and the Danish Naviair have agreed to invest US$120m between them, representing up to 24.5% of Aireon.
The investments will take the form of preferred interests and be made in four tranches between 2014 and 2017. An initial US$50m is due to be paid by 14 February 2014.
At present, Iridium holds an 81.3% interest in Aireon with Nav Canada, the ANSP for Canada, owning the remainder. The two parties have an agreement whereby Nav Canada will invest a total of US$150m in Aireon to ultimately end up with a majority 51% stake in the company.
Nav Canada has so far completed two of five payments that are due to take place by 2017.
Under the agreement with the new investors, Iridium will ultimately receive the US$120m investment thereby ultimately reducing its holding in Aireon to 24.5%. ENAV will own 12.5% of the company with IAA and Naviair both holding 6% stakes.
Commenting on the transaction, Matt Desch, CEO of Iridium, said: “These new investors demonstrate the rapidly growing interest by global ANSPs and are a testament to how valuable the Aireon service will be to the aviation industry. As an investor ourselves, Aireon continues to be a big part of Iridium’s growth strategy, and these agreements further exemplify the success that we expect to see in the coming years.”
Formed by Iridium and Nav Canada in June 2012, Aireon intends to track commercial aircraft and provide that information in near-real time to air traffic controllers for a fee. To do so, Harris is building a hosted payload for the Iridium NEXT constellation that would enable the satellites to receive the Automatic Dependent Surveillance-Broadcast (ADS-B) position signals from aircraft.
Aireon has agreed to pay US$200m in hosting fees to Iridium for the integration and launch of the hosted payloads as well ongoing data service fees of up to US$300m through to 2030.
The first Iridium NEXT satellite is scheduled to be launched in early 2015 with the entire 66 satellite constellation fully launched and operational by 2017.
The payments of both the new investors and Nav Canada are subject to the satisfaction of various operational, commercial, regulatory and financial requirements.
