Israeli Satellite Operator Space Com for Sale

Controlling shareholder Shaul Elovitch reportedly seeking 2 billion shekels for operator of Amos eye-in-the-sky.

Space Com – operator of Israel’s Amos communication satellites – is on the selling block, the company confirmed on Wednesday, leading its stock price on the Tel Aviv Stock Exchange to rise 8% to 51.60 shekels per share. 

Space Com’s controlling shareholder is Shaul Elovitch’s Eurocom Group, which holds a 64.5% stake in the company. Elovitch, who also is the controlling shareholder of Bezeq, is reportedly interested in selling Space Com for 2 billion shekels ($700.6 million) double its current market value on the TASE. Space Com’s board said that in response to interest in a merger or acquisition expressed by several parties, it has hired the investment bank J.P. Morgan to advise it regarding any possible deals. However, the company stated in its announcement that a possible sale was still only in the preliminary stages and there was no guarantee that any deal would take place.

The company earned $7 million in profits between January and September this year on turnover of $73 million, compared to a $4 million profit on turnover of $62 million during the same period in last year. Its operating profit during the past 12-month period was $63 million.

Space Com provided satellite communication services through its satellites Amos 2, Amos 3 and Amos 5. In August the company launched its satellite Amos 4 and plans for it to provide satellite communication services to East Asia, Russia and the Middle East. The company signed an agreement with Israel Aerospace Industries to purchase a new satellite, the Amos 6, to upgrade the services it provides and replace the Amos 2, which is expected to cease commercial use in 2016.

The accumulated orders for the satellites Amos 2, Amos 3 and Amos 4 come to $504 million. Of this, $202 million worth of services will be transferred to the Amos 6 when the Amos 2 is decommissioned. The Amos 4 has $81 million in orders for when it begins commercial service. An additional $65 million in orders have yet to be fulfilled. Space Com has suffered from continued technical problems with the engines of Amos 5 in recent years, leading it to write down the value of that satellite by $14 million.

AP