Iridium signs Coface Facility Agreement
Oct. 6, 2010, McLean, Va. - Iridium Communications Inc. has announced
that it has signed the definitive Coface Facility Agreement to finance
its next-generation satellite constellation, Iridium NEXT.
The syndicate of nine banks is led by Deutsche Bank AG, Banco Santander
SA, Société Générale, Natixis and Mediobanca International S.A., and
includes BNP Paribas, Crédit Industriel et Commercial, Intesa Sanpaolo
S.p.A. and Unicredit Bank Austria AG. They will provide up to $1.8
billion of financing to Iridium for the design and manufacture of
Iridium NEXT satellites. The funding under the Facility is subject to
customary closing conditions, which are expected to be met shortly.
“Iridium is pleased to have received the backing of such a world class
team of financial institutions,” said Matt Desch, CEO, Iridium. “The
support of Iridium NEXT by Coface and the banking syndicate is further
affirmation of our strength as a global business that consistently
demonstrates the ability to provide unparalleled service and unique
value to the vast and growing market for mobile satellite services.”
Desch also affirmed that Iridium NEXT continues to be on track. “In the
four months since we announced Thales Alenia Space as our prime
contractor, they have met the milestones agreed upon for this first
phase of the project, and we are off to an excellent start,” Desch said.
“Our requirements development process is well underway. Planning and
design for the satellites and constellation are on schedule. Both our
teams and roster of partners are growing quickly. On the overall Iridium
NEXT program, we expect to spend approximately $600 million by the end
of 2011. Of this spend, approximately $400 million will be funded under
In addition, Desch commented on current operations. “Our business
continues to perform very well across the board, with continued strong
growth in subscribers, service and equipment revenues, and Operational
EBITDA,” Desch said.
The credit facility consists of two pro rata tranches. One tranche of up
to $1.537 billion will bear a fixed interest rate of 4.96 percent per
annum. The second tranche of up to $.263 billion will bear a variable
interest rated based on LIBOR¹ plus 1.95 percent per annum. Based on the
current six-month LIBOR, the interest rate on this tranche would be
2.41 percent per annum. The repayment period of seven years begins
following substantial completion of the Iridium NEXT launch program,
which is expected to occur in 2017.