Intelsat sold for $3bn

Apax, Apollo, Madison Dearborn and Permira agree to buy the global satellite company months after it abandoned an IPO attempt.

A group of US and UK private equity firms have agreed to purchase global satellite communications company Intelsat for approximately $3 billion (€2.42 billion).

The private equity consortium includes European/US firm Apax Partners, New York's Apollo Management, Chicago's Madison Dearborn Partners and UK-based Permira.

Including approximately $2 billion in debt, the transaction is valued at roughly $5 billion, according to a press release. New debt financing will be provided by Deutsche Bank Securities, Credit Suisse First Boston and Lehman Brothers.

Intelsat, based in Bermuda, provides communications services to broadcasters, corporations and governments. The company, founded in 1964, helped broadcast the images of the first moon walk. Intelsat owns 23 satellites and has offices around the world.

The private equity consortium is making the acquisition through a platform called Zeus Holdings. The company will continue to be managed by chief executive officer Conny Kullman.

Intelsat, with US headquarters in Washington DC, went private in 2001 with a plan to eventually go public again. Several months ago, the company stepped back from plans to undergo and IPO. Currently, Intelsat’s biggest stakeholders are Lockheed Martin, with 24 percent, Tata Sons of India, with 5.4 percent, and France Telecom, with 5 percent.

The Intelsat deal comes just days after a consortium including Kohlberg Kravis Roberts, The Carlyle Group and Providence Equity Partners received Federal Communications Commission approval on the acquisition of PanAmSat, the satellite division of DirectTV Group. That deal has a reported value of $2.6 billion.

In June, The Blackstone Group agreed to buy Netherlands-based New Skies Satellites for $956 million.

Blackstone and KKR also reportedly bid on Intelsat, according to press reports. KKR offered a higher price for the company, but sellers were concerned that the firm’s partial ownership of PanAmSat would create regulatory problems down the road, according to the reports.