Canadian Pensions in $3.4 Billion Bid for Inmarsat

CPPIB, OTTP join consortium to acquire satellite telecommunications firm.

A consortium that includes the $275.4 billion Canada Pension Plan Investment Board (CPPIB), and the $144.9 billion Ontario Teachers’ Pension Plan (OTPP) have agreed to acquire UK satellite telecommunications company Inmarsat for $3.4 billion, or $7.21 in cash per share.

The consortium, which formed a joint venture called Triton Bidco for the purpose of making the acquisition, also includes funds advised or managed by private equity advisory firm Apax, and private equity firm Warburg Pincus. Each of the companies have an equal share in the venture.

According to the contract’s equity commitment letter, the CPPIB’s equity commitment in the joint venture is 29.27%, and the Ontario Teacher’s Pension Plan Board’s is 24.39%. The CPPIB said its financial commitment to the deal will be approximately $900 million. The OTTP didn’t reveal its financial commitment. 

Inmarsat is a provider of mobile satellite services, such as in-flight broadband for airlines, has an in-orbit fleet of 13 owned and operated satellites in geostationary orbit, and provides a portfolio of global mobile satellite communications services.  

“The satellite sector’s unique characteristics—long lead times and the need for deep technical expertise—make it attractive,” said Triton Bidco in a release. “But it is also a sector requiring strategic management and a long investment horizon.”

The $7.21 per share bid is comprised of a cash consideration of $7.09 for each Inmarsat share, plus a dividend of $0.12 per share to be paid on May 30 to Inmarsat shareholders on the register as at the close of business on April 23. The deal is subject to shareholder and regulatory approvals.

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