Satellite communications provider Speedcast International has signed a definitive agreement to purchase Globecomm Systems for around $135m, which includes expected purchase price adjustments.
Globecomm primarily provides remote communications and multi-network infrastructure to various clients involved in the fields of maritime, enterprise, and government sectors in over 100 countries worldwide.
The proposed deal is expected to boost Speedcast’s global competitive advantage in the related sectors, as well as complement the company’s recent acquisition of UltiSat.
It is also expected to double Speedcast’s revenue in the government sector, as well as offer additional scale, visibility and capabilities in this sector.
The deal will allow Globecomm to leverage Speedcast’s capabilities in the maritime and enterprise segments.
Subject to customary closing conditions, including regulatory approvals, the latest deal is expected to be completed in the last quarter of this year.
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Speedcast International CEO Pierre-Jean Beylier said: “This acquisition of Globecomm is fully in line with our strategy to consolidate our industry and thus build competitive advantages based on scale and capabilities.
“Globecomm is particularly complementary to UltiSat as it strengthens Speedcast’s position serving government customers at a time when government spending globally is expected to rise.
“Globecomm has built a strong reputation providing remote communications and professional services to key customers in the government sector, as well as in the maritime and enterprise segments.”
Following the completion of the deal, Speedcast is expected to generate more than $15m in annual cost synergies over a period of 18 months.
The synergies are intended to be generated from various businesses such as footprint rationalisation, network improvements, and developed procurement.
Speedcast is acquiring Globecomm from affiliates of HPS Investment Partners and Tennenbaum Capital Partner.