Eutelsat has agreed to sell its 51% stake in Euro Broadband Infrastructure (EBI), the company operating the Ka Sat satellite, and related European broadband business, to its 49% shareholder Viasat for €140 million.
According to Eutelsat, the transaction completes the reorganisation and simplification of its broadband distribution in Europe following the acquisition of Bigblu Broadband Europe, while moving towards an open technology and freeing up financial resources for investment in direct distribution.
Commenting on the deal, Rodolphe Belmer, CEO of Eutelsat, said: “We are delighted to reach this agreement with Viasat over the future of EBI. It completes the reorganization of our broadband distribution set-up for Europe following the wholesale agreement with Orange for France and the acquisition of Bigblu Broadband Europe covering other major markets. With the recent entry into service of Eutelsat Konnect, to be followed by the launch of Konnect VHTS, we are optimally placed to assure the rapid ramp-up of these new generation in-orbit assets in the coming years”.
Under the agreement, Eutelsat and its subsidiaries will continue to provide transitional services to EBI, including the operation of the ground network for Ka Sat, while EBI will provide service continuity to the Ka Sat subscriber base of Bigblu Broadband Europe acquired by Eutelsat in September 2020.
The stake will be sold for an initial consideration of €140 million, subject to a customary net working capital and net debt adjustments at the time of completion. Two years following completion, the consideration may be adjusted up or down by up to €20 million depending on the level of certain EBI revenues achieved over this period. The transaction will also result in the deconsolidation by Eutelsat of the cash held by EBI of €90 million at September 30, 2020.
Completion is expected in Q1 of calendar year 2021, subject to customary conditions precedent.