Iridium Com (IRDM) Updates on Next-Gen Satellite Plans
Iridium Communications Inc. (Nasdaq: IRDM) today announced its comprehensive plan for funding, building and deploying its next-generation satellite constellation, Iridium NEXT. Specifically, the Company announced the execution of a fixed price contract with Thales Alenia Space, a joint company between Thales (67%) and Finmeccanica (33%), for the design and construction of satellites for the Iridium NEXT constellation. In addition, the company announced that Coface, the French export credit agency, has issued, for the account of the French State, a "Promise of Guarantee" which commits to cover 95% of the $1.8 billion credit facility for the project. The financing to be covered by the Coface guarantee is being syndicated through French and other major international banks and financial institutions and is expected to be completed this summer. The Coface guarantee commitment is not conditioned on Iridium raising any further debt or equity financing. Goldman, Sachs & Co., Societe Generale, and Hawkpoint Partners Limited continue to advise the Company in connection with the financing.
Iridium's fixed price contract with Thales Alenia Space provides for the construction of the originally planned 72 operational satellites and in-orbit spares, plus an additional nine ground spares, which provide greater risk mitigation with respect to the new constellation. As a result of the expanded scope of the project, the total cost of Iridium NEXT, including all costs associated with development, manufacture and launch of the constellation, is now anticipated to be approximately $2.9 billion. In addition, Iridium has entered into an Authorization to Proceed (ATP), which allows Thales Alenia Space to commence work immediately on the development of satellites prior to completion of the financing, with the plan to commence the launch of the first satellites during the first quarter of 2015.
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