SES SA has agreed to buy Intelsat SA for US$3.1 billion in cash to create a satellite giant after reviving talks that fell apart last year.

The deal, which also includes contingent value rights, has been approved by both companies’ boards and Intelsat investors representing about 73% of shares have agreed to vote in favour of the deal, the companies said in a statement on Tuesday (April 30), confirming an earlier Bloomberg News report.

SES and Intelsat held discussions last year to create a satellite giant that can better compete with billionaire Elon Musk’s Starlink broadband internet service. A transaction could have valued the combined business at more than US$10 billion including debt, people familiar with the matter said at the time. However, the talks collapsed after Intelsat failed to reach an agreement with SES and its major stakeholders on the future direction of the business. Luxembourg-based SES counts the small European nation’s government as its biggest shareholder.

SES will finance the deal, which has an enterprise value of US$5 billion, with existing cash and equivalents as well as new debt, including hybrid bonds, the company said. The combined company will be based in Luxembourg and will maintain a “significant presence in the US, notably in the greater Washington” area.

  - Bloomberg