oadband satellite operator, Avanti Communications Group plc (AIM: AVN) (‘Avanti’) announced it has raised £280 million through a combination of equity and debt based financing. The proceeds will fund the purchase, launch and operation of the HYLAS 2 satellite.
"I am delighted to announce the financing of HYLAS 2, which has been made in a manner which is highly efficient for shareholders”, Avanti Chief Executive, David Williams commented, “HYLAS 2 is a much larger satellite and therefore greatly increases our revenue and profit potential. With equity dilution of less than 50%, we gain additional satellite revenue generating capacity of 275%”
The AIM listed satellite telecommunications company will raise £86 million through the placing of 21.5 million new ordinary shares to new and existing institutional investors at a price of 400p per share. The new placing shares will represent approximately 48% of the company’s enlarged share capital. Avanti also secured a combined £194 million in debt facilities with the Export-Import Bank of the United States (Ex-Im Bank) and French export credit insurance company COFACE. The debt facilities have a total maturity of 10 years and bear an aggregate annualised interest rate below 6%.
Avanti will procure the HYLAS 2 satellite from Orbital Sciences Corporation (NYSE: ORB) and will purchase launch services from France’s privately owned Arianespace. The HYLAS 2 satellite is planned to launch in the first half of 2012.
HYLAS 1, Avanti's first satellite scheduled for launch in Q2 2010, will be the first superfast broadband satellite launched in Europe. HYLAS 2 will duplicate HYLAS 1 coverage over Europe, and will also add new coverage in Eastern Europe, the Middle East and parts of Eastern and Southern Africa. According to Avanti combining HYLAS 1 and HYLAS 2, will provide the joint capacity to support up to 1.35 million broadband customers. HYLAS 2 offers 8,280 MHz of capacity while HYLAS 1 has 3,000 MHz.