Echostar, Liberty Media Reportedly is Bidding for Intelsat
Washington, D.C., June 15, 2007 - Satnews Daily - Liberty Media and EchoStar Communications Corp. are reportedly bidding for Intelsat according to media reports and a source close to the deal.
Intelsat is the world’s largest satellite operator with a fleet of 51 satellites in operation, after its merger with PanAmSat last year. In April, it was reported that a consortium of private equity investment firms placed a bid for US $ 5.5 Billion for Intelsat.
Echostar Communications control the second largest Direct-to-Home service in the US, while Liberty Media will take control of No. 1 U.S satellite TV operator DirecTV Group Inc.this year. The two companies are reportedly preparing a joint bid for Intelsat.
Intelsat was purchased just three years ago by a private equity consortium for $515 million and assumption of debt. Intelsat’s debt has since ballooned to $11 Billion with revenues of about $2 Billion last year.
Analysts are speculation that demand for transponder capacity will increase in the new few years fueled by consumer broadband, mobile services and new applications such as HDTV and IPTV. The increased demand will result in higher prices Liberty Media and Echostar are both active in these areas and would benefit from ownership of the world’s largest satellite operator.
Liberty Media is controlled by telecommunications magnate John Malone while Echostar is headed by industry pioneer Charles Ergen. According to a report in the Wall Street Journal, The joint-bid being prepared by Liberty Media and Echostar comes as Intelsat prepares to accept final bids for its auction. According to the report, offers for Intelsat are expected to range from $4.5 billion to $5.5 billion.
