NewSat seeks $AU36m to get into orbit
Suppliers turn in the pressure
Australian satellite communications company NewSat is raising $AU36 million to help accelerate its pending satellite launch, pay suppliers and strengthen its balance sheet.
NewSat's Jabiru-1 geostationary communications satellite will provide high capacity to military, defence and government markets as well as other enterprise segments such as resources. It is expected to launch in mid-2014.
The need for speedy cash has been sparked by Lockheed Martin, NewSat’s satellite manufacturer, which is currently fast tracking the procurement of critical components of the satellite and is demanding capital earlier than expected.
NewSat said in an Australian Securities Exchange statement that it has already commenced contributing funds to the procurement, and will continue to contribute in accordance with the satellite procurement agreement.
NewSat will also use the new funds to make a payment to Arianespace for their provision of launch facilities for the satellite.
As part of the capital raising, $10 million has already been placed with sophisticated investors and international financial institutions via financial advisers Lazard.
The rights issue will be offered on the basis of one new share for every four shares held, at an application price of 60 cents per share, which if fully subscribed would raise $AU26 million.
NewSat has currently applied to the French and US based export credit agencies for funding for Jabiru-1. Final approvals are expected early in the second quarter of 2012.
“So far we have secured $US346 million in prelaunch customer contracts and have a promising $US575 million sales pipeline, all of which have assisted us to successfully move to the next stage of export credit funding with US Ex-Im Bank and Coface,” said, NewSat Founder and CEO Adrian Ballintine.
He added that NewSat was rapidly transforming from a Teleport operator into a global satellite operator, with an aggressive multiple satellite strategy. ®
Sponsored: IBM FlashSystem V9000 product guide