US group Blackstone pays £520m for New Skies

The private equity group Blackstone agreed yesterday to pay $956m (£520m) cash for the Netherlands-based New Skies Satellites, which is nearly 25 per cent owned by UK institutions. Blackstone, a US group, is best known in Britain for until recently owning the Savoy Hotels group.

The private equity group Blackstone agreed yesterday to pay $956m (£520m) cash for the Netherlands-based New Skies Satellites, which is nearly 25 per cent owned by UK institutions. Blackstone, a US group, is best known in Britain for until recently owning the Savoy Hotels group.

The move is the latest step towards transforming the ownership of the satellite industry. In April, Kohlberg Kravis Roberts, the world's biggest buyout firm, agreed to buy PanAmSat, the largest US commercial satellite operator, for $3.53bn. "Because of our predictable cash flows, private equity has discovered the satellite sector," said Dan Goldberg, New Skies' chief executive. The company has five satellites in orbit, compared with 41 at the Luxembourg-based SES Global, 20 at the Paris-based Eutelsat and 23 at Intelsat.

New Skies claims to be one of only four fixed satellite communications companies with truly global satellite coverage, offering services to telecommunications carriers, broadcasters, large corporations, internet service providers and government entities around the world.

New Skies shares fell a cent to €6.62 (£4.41) at the close of trading in Amsterdam on Friday. That values the company at $957m, $1m more than the bid.

The business and operations of New Skies will be transferred to Blackstone and the cash generated distributed to shareholders, the company said. It expects the purchase to be completed by the end of this year or early 2005.