China Great Wall Industry Corporation (CGWIC) has agreed to buy a 10.85% stake in Hong Kong-based satellite operator APT Satellite for HK$132.3m (US$17m).
CGWIC is buying the minority stake in APT Satellite via the purchase of CASIL Satellite, which…
China Great Wall Industry Corporation (CGWIC) has agreed to buy a 10.85% stake in Hong Kong-based satellite operator APT Satellite for HK$132.3m (US$17m).
CGWIC is buying the minority stake in APT Satellite via the purchase of CASIL Satellite, which directly owns 3.47% of the operator and indirectly owns another 7.38% (CASIL Satellite controls 14.29% of APT International, which holds 51.67% of APT Satellite).
CASIL Satellite itself is owned by investment holding Sinolike, which in turn is controlled by another investment holding company, CASIL.
Both CGWIC and CASIL are owned by China Aerospace Science and Technology Corporation (CASC), the main state-owned contractor for the Chinese space programme.
Once the deal is completed, CASIL Satellite will no longer be a subsidiary of CASIL, the company explained in a notice to the Hong Kong Stock Exchange.
In its latest financial results, APT Satellite posted profit before taxation of HK$350m (US$45m) as of 31 December 2010, a 29% increase on 2009. It also reported liabilities of HK$1.31bn (US$169m), a 59% jump compared with 2009. Its EBIDTA margin was 82% against 76% in 2009.
The company also said that its capex incurred for fixed assets and intangible assets was HK$1.162bn (US$150m) for 2010 against HK$789m (US$101m) the previous year, mainly for the construction of two new satellites, APSTAR 7 and APSTAR 7-B.
Apstar 7 is being built by Thales Alenia Space at a cost of US$191m. It will be launched between February and April 2012 and will replace APSTAR 2R at the 76.5E orbital position. It will carry 28 Ku-band and 28 C-band transponders.
APT has also ordered APSTAR 7-B, to be manufactured by Thales Alenia Space for E112.3m. The satellite is being financed through an E100m loan from a China Satcom subsidiary.
It will function both as a standalone satellite and as a back-up replacement for APSTAR 7 in case of any launch failure when that spacecraft launches in 2012.
According to an APT release in June 2010, APSTAR 7-B will also function as new satellite capacity for China Satcom. It said: “The parties will both benefit from the synergy as a result of the entering into of the Co-operation Agreement whereby the cost of entering into satellite procurement contracts will be reduced and the risk thereof is better controlled.”
As for China Great Wall, the company signed, in December 2010, an agreement with the Bolivian Space Agency (ABE) to construct and launch its forthcoming TKSat-1 communications satellite.
SatelliteFinance understands that the contract is worth in the region of US$300m with the Bolivian government paying just under US$50m and the rest being financed via a loan from the China Development Bank.
In November 2010, China Great Wall also signed a bulk purchase framework agreement with China Academy of Launch Vehicle Technology (CALT) and China Academy of Space Technology (CAST) for 20 Long March 3A series rockets and 8 DFH-4 communications satellites respectively. The contract is worth Y15bn (US$2.26bn) over the next five years.
