Inmarsat postpones IPO again

As the telecom sector lingers under a shadow, the satellite firm puts its listing on hold for the third time and a sale to private equity buyers becomes a growing prospect.

As if anyone needed reminding that the telecom sector remains a an object of suspicion amongst many investors, Inmarsat, the telecommunications satellite company whose owners include Deutsche Telekom and France Telecom, has again postponed its long-scheduled IPO.

The Financial Times reports that the planned listing in UK and New York this summer has again been shelved on account of poor investor sentiment. Although analysts have suggested that the company could be worth up to E1bn, the prospect of rolling out satellite broadband services from 2004 has left the buyside cold.

The collapse of other satellite companies ICO and Iridium has done little to boost investor appetite and the company is struggling to convince the market that its wish to list and acquire is a compelling prospect.

It is reported that some Inmarsat shareholders are warming to the prospect of selling their stakes to private equity buyers. Not only might this realise more value but also would avoid the need to convince the public markets that the company is an appetising IPO candidate.

Given that shareholders such as Deutsche Telekom and France Telecom are still themselves under considerable pressure to reduce their debt burden and streamline their operations, so a sale to a financial buyer looks all the more attractive.

Inmarsat runs nine satellites that provide phone, fax and data transmission services to aircraft, ships, vehicles and portable terminals.

The newspaper also reports that France Telecom has been in discussion with Eurazeo, the increasingly private equity like investment holding company of the Lazard group, to sell its 23.1 per cent stake in Eutelsat, another European satellite operating group. Again, Deutsche Telecom are shareholders in this company alongside British Telecom and both are reported to be seeking buyers for their combined 28 per cent stake. The paper suggests that KKR, Permira and Apax could all be interested in buying their stakes.