IDB’s Bid for Israeli Satellite Operator Spacecom Nearing Closure
Last week, Israel-based holding company IDB made an offer for a controlling stake in satellite operator Spacecom, offering $45.75 million for a 54.7% undiluted stake and an equity infusion of as much as $11.45 million
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Last week, IDB offered to buy the Israeli satellite operator, also known as Spacecom. Spacecom, which operates Israel’s AMOS communication satellites, is a subsidiary of Eurocom Group, the controlling stakeholder of Israel’s largest telecommunication provider, Bezeq. Together with its subsidiaries, Eurocom and its co-owner Shaul Elovitch owe a debt of around $420 million to institutional creditors, including Israel’s three largest banks. Mr. Elovitch has been negotiating Eurocom’s sale for several months.
Argentinian businessman Eduardo Elsztain. Photo: Orel Cohen
IDB has previously expressed interest in acquiring Eurocom. Last week the company made an offer just for Spacecom, offering $45.75 million (NIS 160 million) for a 54.7% undiluted stake in Spacecom, and an equity infusion of as much as $11.45 million (NIS 40 million).
According to the person, intensive negotiations over the past few days resulted in Discount Investment Corporation agreeing to an equity infusion of up to $34 million (NIS 120 million).
The deal is expected to be submitted by the end of the week to the approval of an Israeli District Court.
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Spacecom’s AMOS-6 satellite was destroyed in 2016 in a pre-launch explosion, causing the company to lose a $95 million leasing deal with Facebook, as well as a planned $285 million acquisition by Shanghai-listed telecommunication technologies supplier Beijing Xinwei Technology Group Ltd. Spacecom was also forced to lease a replacement satellite at $22 million a year.
Last week, Spacecom announced it has contracted a company to build AMOS-8, intended to replace AMOS-6. The company does not have the money to finance the $112 million deal and stated it intends to raise at least $150 million from the public, from institutional investors, and from banks.
