01 June 2017
Intelsat S.A. announced that the previously announced (i) offer or offers to exchange (collectively, the “Exchange Offers”) certain of the respective outstanding senior unsecured notes (the “Existing Notes”) issued by its indirect wholly-owned subsidiaries, Intelsat Jackson Holdings S.A., Intelsat Connect Finance S.A., and Intelsat (Luxembourg) S.A. (collectively, the “Issuers”) and (ii) solicitation or solicitations of consents (collectively, the “Consent Solicitations”) to amend the indentures governing the Existing Notes expired pursuant to their terms at 12:00 midnight, New York City time, on May 31, 2017. As of the expiration date, the minimum tender conditions for the Exchange Offers and Consent Solicitations had not been satisfied. The Issuers have not accepted any of the Existing Notes for exchange, any Existing Notes tendered for exchange will be promptly returned to holders, and the Exchange Offers and Consent Solicitations have accordingly been terminated.
The Exchange Offers and Consent Solicitations were conducted pursuant to the Combination Agreement, dated as of February 28, 2017 (as amended by that certain First Amendment to and Waiver Relating to the Combination Agreement, dated May 17, 2017, the “Combination Agreement”), between Intelsat and WorldVu Satellites Limited (“OneWeb”), pursuant to which Intelsat and OneWeb would combine through a merger, and the related Share Purchase Agreement, dated as of February 28, 2017 (as amended by that certain First Amendment to and Agreement Relating to the Share Purchase Agreement, dated as of May 17, 2017, the “Share Purchase Agreement”) among Intelsat, SoftBank Group Corp. (“SoftBank”) and OneWeb, pursuant to which SoftBank would make a cash investment in exchange for common and preferred shares of the combined company contemporaneous with the closing under the Combination Agreement. The successful completion of the Exchange Offers would have satisfied a condition to completion of the transactions under the Combination Agreement and the Share Purchase Agreement. Intelsat has notified OneWeb and SoftBank of the failure to consummate the Exchange Offers.
As a result of the termination of the Exchange Offers, Intelsat currently expects that OneWeb and SoftBank will exercise their respective termination rights under the Combination Agreement and related Share Purchase Agreement on June 2.
Intelsat CEO Stephen Spengler said, “There were many stakeholders’ interests that needed to be satisfied in this complex transaction. We are disappointed that our bondholders were unwilling to accept the terms of the exchange offers presented over the course of this process. Even without a merger of our companies, the pre-existing commercial agreement among Intelsat, OneWeb and SoftBank will continue. Under this agreement, we plan to jointly develop integrated solutions utilizing both of our fleets and to act as a sub-distributor to SoftBank for the attractive application segments of mobility, energy, government, and connected car. As we create integrated services for these applications, we expect to accelerate and enhance our goal of unlocking new and larger opportunities in the communications landscape. We remain focused on achieving our operating priorities for 2017, including the continued commercialization of our Intelsat EpicNG high throughput satellite services.”