SESA merger discussions terminate as Intelsat withdraws

Intelsat, a prominent U.S. satellite communications giant, has decided to discontinue merger negotiations with SES, a Luxembourg-based competitor, as confirmed by CNBC.

According to an anonymous source familiar with the situation, Intelsat withdrew from the discussions due to diverging business priorities with SES. Furthermore, it remained uncertain whether the proposed merger would generate more value than Intelsat operating independently. To maintain confidentiality, the person spoke without disclosing their identity.

This potential merger aimed to create a combined U.S. and European entity valued at over $10 billion, as previously reported.

Both companies are currently facing increasing pressure amidst a transformation in the satellite communications market, shifting from video broadcast to data services. Consequently, the industry has witnessed a surge of consolidation. SpaceX, led by Elon Musk, has notably disrupted the market with its Starlink business, gathering over 1.5 million customers within three years of its launch.

When approached for comment, an Intelsat spokesperson declined CNBC’s request, stating that the company regularly engages in strategic discussions with potential partners but refrains from disclosing the content and outcomes of these conversations.

SES has not yet responded to CNBC’s request for comment. The news of the halted negotiations was initially reported by Bloomberg.

This collapse in merger talks follows closely after the announcement of SES CEO Steve Collar stepping down at the end of this month. Collar’s unexpected departure has surprised the space industry, considering his more than 20-year tenure at SES.