Inmarsat turns down second takeover offer from rival Echostar worth £3.2bn

BRITISH SATELLITE firm Inmarsat has rejected a second takeover approach from US rival Echostar worth £3.2bn.

Echostar confirmed on Friday that it put forward a “new and improved proposal” earlier this week which offered shareholders 265p per share in cash and an exchange of 0.0777 Echostar stock for each Inmarsat share.

That offer is equivalent to 532p per Inmarsat share and would value the company at £2.45bn.

Additional terms for convertible bond holders take the total value of the bid to £3.2bn.

But that sweetened deal was rebuffed by Wednesday, nearly a month after Echostar’s initial approach was rejected.

In a statement, Inmarsat said it had “carefully” considered the offer but turned it down on the basis that it “very significantly undervalued Inmarsat and its standalone prospects”.

“The board remains highly confident in the independent strategy and prospects of Inmarsat,” the company said.

The terms of the first proposal have not been disclosed.

Inmarsat shares tumbled on the news, and were trading lower by more than 7 per cent.

Echostar has not yet given up hope, saying it “continues... to seek engagement with the board of Inmarsat on a constructive basis, with a view to agreeing the terms of a recommended transaction”.

The company is now seeking an extension of a deadline that required it to table a firm proposal by 5pm yesterday.

“EchoStar believes a combination of EchoStar and Inmarsat is strategically compelling,” its market statement said.

“The combined group would be one of the world’s leading satellite providers and be well-supported by a global portfolio of complementary assets and service offerings.

“EchoStar believes that the improved proposal presents a compelling opportunity for Inmarsat’s shareholders.”