CMA opens investigation into £2.6 billion Inmarsat deal

The Competition and Markets Authority (CMA), the competition watchdog, has opened an investigation into the proposed £2.6 billion takeover deal of Inmarsat.

A consortium of private equity firms agreed terms on a takeover for the London based satellite communications company in May, with 79 per cent of shareholders approving the deal.

The deal is headed by Warburg Pincus and Apax Partners, with a share offering of £5.81 per share.

However, the CMA has now said that it will be exploring whether the deal will lessen competition in the market, which could impact the takeover.

Inmarsat has seen a series of takeover offers that have failed to materialise this year, with the US satellite company Echostar tabling a £3.2 billion offer before the French business Eutelsat abandoned their plans to make an offer.

Inmarsat’s first-quarter trading fell by 12.9 per cent, despite a 0.4 per cent increase in overall revenue.

The CMA has invited comments from any interested party on the merger by 29 July, with the deadline for the phase one decision on 10 September.

If it is completed, the deal will be the second-largest public to private deal ever made in the UK.

The CMA has already blocked one significant deal this year, with the proposed merger between Sainsbury’s and Asda being rejected because of concerns over price increases.

 

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Nigel Fry

Nigel Fry

General Practice Partner
Nigel Fry is a General Practice Accountant who qualified with Coopers & Lybrand (now PricewaterhouseCoopers) in Bristol. His main focus was dealing with owner managed businesses in their growing businesses division but he also undertook secondments to the audit department in both Bristol and Australia.