Harbinger Capital Partners has sold approximately half its stake in Inmarsat via an institutional share placing. The hedge fund sold 65 million shares, representing 14.1% of the issued share capital of Inmarsat, at 630 pence per share to raise gross…
Harbinger Capital Partners has sold approximately half its stake in Inmarsat via an institutional share placing. The hedge fund sold 65 million shares, representing 14.1% of the issued share capital of Inmarsat, at 630 pence per share to raise gross proceeds of £410m. Following the transaction, Harbinger retains a 14% stake in the MSS operator. This holding of just under 64.3 million shares is subject to a 180 day lock-up arrangement with joint bookrunners Credit Suisse and UBS. The sale, which was oversubscribed, finally brings to an end to Harbinger’s interest in acquiring Inmarsat outright. In mid-2008, the hedge fund announced that it planned to acquire Inmarsat through its US subsidiary SkyTerra. At the time, no formal terms of an offer were set as regulatory approval was sought first, a process that was expected take around 12 to 18 months. In the interim, Harbinger shifted its focus onto its LightSquared project in the US and having recently triggered the L-band cooperation agreement with Inmarsat, which includes an option for LightSquared to lease a portion of Inmarsat’s spectrum, Harbinger no longer had a strategic need to maintain its holding in Inmarsat. To that end, on the day prior to the share placement Harbinger stated that it subsequently had no intention in bidding for Inmarsat. Proceeds from the sale are, though, not expected to be used to help fund LightSquared and instead will be returned to the investors of the Harbinger Capital Partners Special Situations Fund and Harbinger Capital Partners Master Fund I. The hedge fund first invested in Inmarsat in 2007. As to whether Harbinger would maintain its remaining holding in the London-based satellite operator once the lock-up expires, the hedge fund’s chief executive Phil Falcone said in a statement: “Inmarsat has been a terrific investment for Harbinger and its investors. Although we have determined that we are not going to make an offer for all of the company, I remain a strong believer in Inmarsat’s future and am extremely happy to maintain a core position in the company’s stock and our partnership with Inmarsat through LightSquared.” However, not all investors believed this view and subsequent to the placement Inmarsat’s share price fell 4% to 629 pence, the largest fall since August 19, with the one banker suggesting that the stock price will remain hamstrung by market expectation over Harbinger offload its remaining stake.
