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TOP NEWS: UK Government Happy With Remedies To Inmarsat Buy Concerns

Wed, 9th Oct 2019 17:17

(Alliance News) - The UK government is to consult on whether to accept undertakings provided by both Inmarsat PLC and the buyers of the satellite firm, it said on Wednesday.

Inmarsat in March agreed to a GBP3.4 billion takeover by a consortium including private equity firm Apax Partners LLP, Warburg Pincus International LLC, the Ontario Teachers' Pension Plan Board, and the Canada Pension Plan Investment Board.

A public interest intervention notice was served on the acquisition by the UK Secretary of State for Digital, Culture, Media, & Sport Nicky Morgan in July, and the UK Competition & Markets Authority submitted a report to the government in mid-September outlining potential competition and national security concerns.

The UK government on Wednesday said the CMA found no competition concerns in the deal.

However, the UK Ministry of Defence found two national security concerns: firstly, that insufficient security controls could result in unauthorised access to defence and security data held by Inmarsat, and secondly, that "certain capabilities" used by Inmarsat could be halted or sold abroad.

A third party has also raised concerns that Inmarsat could stop offering satellite services used in the Global Maritime Distress & Safety System.

Inmarsat and the buyers have now made a series of commitments to assuage any concerns. These include a promise to uphold any contractual agreements with the UK MoD and to give ample warning if it is not able to continue doing so.

They will also ensure adequate security controls on sensitive information are put in place, with sensitive material only handled by UK companies. At least 50% of Inmarsat's directors will be UK nationals, the chair must be a UK national, and whoever is in charge of internal security at Inmarsat will be a UK national.

Morgan is prepared to accept these undertakings, the government said, but a consultation on whether to do so has opened and will run until October 24.

Inmarsat shares closed 0.2% higher on Wednesday in London at 584.00 pence each.

By George Collard; georgecollard@alliancenews.com

Copyright 2019 Alliance News Limited. All Rights Reserved.

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