BC Partners buys Intelsat after agreeing to renegotiate financing

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The Independent Online

BC Partners, the European private equity group, has sealed the $16.5bn (£8.4bn) takeover of the satellite group Intelsat, thought to be under threat after the credit crunch last summer.

BC announced the completion of the takeover, its largest-ever deal, after it agreed to renegotiate its financing package. The deal, which had initially been agreed last June, involved the private equity groups Silver Lake and Unison.

The news come a week after BC admitted it had lost more than $300m after selling the US auto parts business Mark IV Industries.

Credit Suisse, Morgan Stanley and Bank of America, the banks underwriting the buyout, asked the existing lenders to roll their loans, according to a source close to the deal. He added that the move was preferred to refinancing the debt package in the open market, given the tightened credit conditions.

David McGlade, the chief executive of Intelsat, said: "This transaction closes at a time when Intelsat is seeing strong momentum. We have improved the operating profile of our company, based on initiatives such as our fleet management programme and the introduction of new services."

Intelsat was put up for sale by its private equity owners Apax Partners, Permira, Madison Dearborn and Apollo Management in April. Its customers include the US television networks ABC and CBS, France Telecom, News Corporation and the US military. The initial consortium of private equity owners bought the Bermuda-based satellite company in 2004 for $5bn after a takeover battle from a rival consortium.

BC is preparing to expand its operations in the US. The group's US office was previously only used for investor relations, but is being beefed up this year to start originating and executing deals. Three partners are expected to be located in the US from the second quarter, and the office will then be strengthened over the following 18 months.

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