ViaSat has announced that it has received a long-term loan commitment of up to US$524.9m from the US Export Import Bank to fund its ViaSat-2 project.
SatelliteFinance understands that the loan was taken out by a newly established UK-based entity, ViaSat…
ViaSat has announced that it has received a long-term loan commitment of up to US$524.9m from the US Export Import Bank to fund its ViaSat-2 project.
SatelliteFinance understands that the loan was taken out by a newly established UK-based entity, ViaSat Technologies Limited, with the satellite broadband specialist having set up a base in Dorset, in the South West of the country.
Commenting on the financing as part of the company’s Q2 fiscal 2015 results announcement, ViaSat founder and CEO Mark Dankberg said: “We received a loan commitment from Ex-Im Bank for up to US$524.9m of long-term, fixed rate financing. With long-term interest rates at historic lows, this financing is expected to enhance the cash flow profile for ViaSat-2 and improve our overall corporate liquidity position.”
According to the summary of an Ex-Im board of directors meeting at the end of September, the financing has been approved and is awaiting final authorisation. The loan will have a tenor of around eight years and JP Morgan is the guaranteed lender.
ViaSat has previously estimated that its forthcoming high-throughput satellite will cost a total US$625m. The rump of this is the satellite construction contract with Boeing which is worth just over US$350m. The remainder comprises the launch, insurance and ground segment costs.
Insurance sources have suggested that Aon ISB is currently in the market with a launch-plus-one placement for the satellite and is looking for coverage worth US$450m.
Based on Boeing’s 702HP satellite bus, ViaSat-2 has double the bandwidth of its predecessor and seven times the coverage area. This enables ViaSat to expand into
Central America, the Caribbean and the northern portion of South America, as well as push further into the maritime and in-flight broadband markets by covering key routes across the Atlantic Ocean.
The satellite is due to be launched by SpaceX in mid-2016,.
In its Q2 fiscal 2015 results, ViaSat reported a substantial increase in adjusted EBITDA, up 102% year-on-year to US$109.7m. Revenues also rose but by a far less dramatic amount, increasing by 1.3% to US$358.8m.
ViaSat put the increase down to significant momentum in its core consumer and government businesses in the second quarter, driven in particular by strong market reaction to new service plans that offer greater bandwidth usage.
