DOJ Clears Intelsat-PanAmSat Merger

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The U.S. Department of Justice is closing its antitrust investigation of Intelsat Ltd.’s $3.2 billion proposed merger with PanAmSat Holding Corp., clearing the merger, Intelsat said Friday.

The Justice Department isn’t seeking any conditions on the proposed merger and is not otherwise commenting on it, according to Intelsat. But the transaction remains under review by the FCC.

“We are gratified that the Justice Department’s Antitrust Division, after a comprehensive review, agreed with us that the Intelsat-PanAmSat merger does not pose any threat to competition,” Intelsat’s executive vice president and general counsel Phillip Spector said in a prepared statement.

Intelsat and PanAmSat announced their merger agreement Aug. 29.  Under the agreement, Intelsat will acquire PanAmSat for $25 per share in cash, or $3.2 billion.  In addition, about $3.2 billion in debt of PanAmSat and its subsidiaries will remain outstanding or be refinanced. 

The transaction’s closing is subject, among other things, to the receipt of financing by Intelsat and to obtaining regulatory approval from the FCC.  All other regulatory approvals required prior to closing have been obtained.

“With the Justice Department’s decision not to challenge our transaction, we are moving full speed ahead with our integration planning and preparations,” Intelsat CEO David McGlade said in a prepared statement. “We will be finalizing our financing over the next few weeks, and should be in a position to close soon after receiving FCC approval.”

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