The British satellite communications company Inmarsat has agreed a $7.3bn (£5.4bn) takeover by the U.S. rival Viasat.
Viasat described the deal as “transformative” for the industry, and said it intended to work with the government to continue to invest in its presence in the UK, where it currently employs 860 people at its base in Old Street.
“Viasat plans to build on Inmarsat’s presence in the UK and is committed to preserving and growing the investment of the combined company in UK space communications”, the Californian-based company said.
Inmarsat provides mobile satellite services that underpin email, internet and video conferencing, as well as in-flight wifi.
It has 14 satellites in orbit and plans to launch another seven. It also supplied satellite services to the Ministry of Defence to improve ground communications for troops fighting in Afghanistan.
Inmarsat was listed on the London Stock Exchange before being taken private two years ago by a consortium including the private equity firm Apax.
As a company, Immarsat has faced fierce competition in recent years, especially with the likes of Elon Musk’s SpaceX.
Given the nature of Inmarsat’s industry the deal is likely to be reviewed under the new National Security and Investment Act 2021.
In July, the government launched a review of the takeover of the Welsh microchip manufacturer Newport Wafer Fab by Nexperia, the Chinese-owned company that acquired the UK’s largest producer of semiconductors.
However, “Joining with Viasat is the right combination for Inmarsat at the right time,” said Rajeev Suri, the chief executive of Inmarsat.
“The industrial logic is compelling and ensures that the UK has a strong and sustainable presence in the critical space sector for the long term.”
Viasat, which has a UK base and supplies services and products to the MoD, said it expected the combined company to be able to make cost savings of $190m a year.
“Decisions regarding management of the combined company following the closing of the transaction will be made as part of the integration planning process,” it said.