Macquarie, Credit Suisse seek buyers for Speedcast

Speedcast, the listed remote satellite communications provider, has reportedly appointed Macquarie and Credit Suisse to look for a buyer, but the search so far has proved luckless.

The company’s major shareholder is private equity group TA Associates which holds 13 per cent after listing the company through an IPO in 2014. Speedcast chief executive Pierre-Jean Beylier has a 3.5 per cent holding.

Challenger and Greencape Capital are the other large shareholders with 11.65 per cent each and the stock has started to rise over the past few weeks.

Speedcast’s shares were trading at $3.31 last week and closed last night at $3.62. The peak this year was $4.10 and the shares have performed well since listing in August 2014 at $1.96.

The recent rally in the stock has pushed its market capitalisation up to nearly $900 million despite the concerted efforts of Macquarie and Credit Suisse to find a buyer.

Speedcast is a Hong Kong-based satellite communications company and in July announced it would buy the US-based company UltiSat.

It extended its current debt facilities to pay $US65m ($81m) for UltiSat. It was reported that Speedcast would pay an additional $35m in earn-out payments over the next two years.

Speedcast last year paid $US425m for Harris CapRock and as part of the deal it raised $295m from existing shareholders through an entitlement rights offer. Credit Suisse was the sole financial adviser and carried out the capital raising with UBS.

DataRoom understands Macquarie is leading the search for a buyer and has tapped the local private equity players who could be keen for a deal of this size.

However, the hunt has turned up empty-handed, leading the advisers to look overseas for a likely acquirer.

Speedcast announced a $US15.1m net profit in the first half on revenue of $US246.3m.

However, analysts said the company’s EBITDA growth, not taking into account its previous acquisitions, was only 3 per cent.