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Intelsat gets financing commitment from four banks for PanAmSat purchase
By Sara Rosenberg
New York, Aug. 29 - Intelsat Ltd. has received financing commitments from Deutsche Bank Securities Inc., Citigroup Global Markets Inc., Credit Suisse First Boston LLC and Lehman Brothers Inc. to finance the purchase of PanAmSat Holding Corp., according to a company news release.
Under the acquisition agreement, Intelsat will pay $25.00 per share in cash, or $3.2 billion, for PanAmSat to create one large Pembroke, Bermuda-based satellite company with U.S. headquarters in Washington, D.C.
In addition to the purchase price, Intelsat will either refinance or assume $3.2 billion in debt of PanAmSat and its subsidiaries.
A substantial portion of financing for the transaction is expected to be raised at Intelsat (Bermuda) Ltd., with additional financing expected to be raised at PanAmSat Holding, PanAmSat Corp. and Intelsat Subsidiary Holding Co. Ltd.
Prior to this financing and the closing of the transaction, Intelsat (Bermuda) Ltd. is expected to transfer substantially all of its assets and liabilities, including its 9¼% senior discount notes due 2015 to a newly formed wholly owned subsidiary.
The transaction is expected to result in a change of control, as defined in the indenture governing PanAmSat's outstanding bonds.
The combined company is expected to have pro forma annual revenues of more than $1.9 billion and to maintain significant free cash flow from operations, providing significant resources for capital expenditures and debt service.
Completion of the buyout, which could happen in six to 12 months, is subject to PanAmSat shareholder approval, customary closing conditions and regulatory clearances, including the appropriate U.S. government antitrust authorities and the Federal Communications Commission.
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