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INMARSAT, the global satellite communications company part-owned by British Telecom, is to be sold for £900m.
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George Soros's Private Equity Partners with New York's Apollo Management are the favourites to buy, but rival venture capitalists Apax Partners and Permira are also still in the running, according to a source. The deal could be concluded before the end of the month.
The recent revival in equity markets has helped the company hold out for the maximum price possible.
Just three months ago, private equity companies discussed buying Inmarsat for £625 million - almost 50% lower than the price now under negotiation.
Chief executive Michael Storey told Financial Mail: 'Our position is quite clear. The plan was for a flotation, but markets were not strong enough. Equities are now showing signs of life so that remains a possibility, but we have always kept our options open.'
Another source close to the company dismissed as 'total rubbbish' rumours that talks with Soros had broken down because of management objections over new strategy proposals.
The source added: 'The management would not have any idea what a buyer's plans might be. The decision is for shareholders.'
Financial Mail understands that meetings were held with the venture capitalists last week and that the deal has now entered its final stages.
'There are minor due diligence issues to be cleared, but it is almost a contract race now,' the source said. 'The shareholders have a clear idea of the price they expect.'
The company made profits of £115.8 million last year compared with £37.3 million in 2001. It is
understood to have benefited considerably from the Iraq war.
The company's systems were widely used by journalists covering the conflict and Inmarsat moved a second satellite to provide additional channels.
British Telecom has 7.8% of Inmarsat while Telenor of Norway has 14.9%. Comsat Corporation based in the United States has 14%.
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