Investindustrial backs Eutelsat stake acquisition

The Italian private equity group formerly known as 21 Invest has joined forces with publisher group De Agostini to acquire a E210m stake in Eutelsat, the satellite operator.

21 Invest, the European private equity house which recently embarked on a rebranding exercise and has changed its name to Investindustrial, has teamed up with Italian publishing group De Agostini to acquire a minority stake in Eutelsat, a European satellite operator that is controlled by Europe’s major telecom companies.


Deutsche Telekom is selling a 10.9 per cent stake to a Luxembourg holding company controlled by De Agostini, with Investindustrial coming in as a minority shareholder and the German telecom group also taking a stake. The holding company will pay E210m for the 10.9 per cent stake, valuing Eutelsat, Europe’s second largest satellite operator, at just under E2bn.


The deal is likely to be the catalyst for a series of private equity plays in the satellite operative sector. France Telecom and BT, which hold stakes of 23.1 and 17.5 per cent respectively in Eutelsat, are believed to be keen to offload their interests in the business. Earlier this year, a company majority-controlled by Lehman Brothers’ private equity division acquired Telecom Italia’s 20.5 per cent stake in the Eutelsat for $480m.


A source close to Investindustrial said the firm had not consulted with Eutelsat’s other shareholders, and was not aware of any imminent transactions. “Investindustrial sees Eutelsat as a well performing company with strong revenue streams. The firm is not concerned with what the company’s other shareholders plan to do with their interests for the time being.”


Largest shareholder France Telecom recently tried to sell its holding in Eutelsat to French private equity house Eurazeo. The deal collapsed when the two firms failed to agree a price. Deutsche Telekom is selling its entire 10.9 per cent stake in the company as part of plans to reduce its E64bn debt pile. Eutelsat’s other shareholders include many of Europe’s incumbent telecom operators, including, Belgacom, KPN, Russian Satellite Communications Company and Telekom Polska.


Eutelsat's rival Inmarsat is also close to undergoing a change of ownership. Financial investors Apollo, Apax and Permira are in the final round of bidding for the European satellite operator, having submitted offers for the business in the region of £1bn. US operator Intelsat has indicated that it is considering making an outright bid for Eutelsat, which would value the business at up to E2.8bn.


Investindustrial and De Agostini are yet to finalise the financing arrangements for the transaction.