The American satellite company Intelsat and the Luxembourg operator SES have stopped negotiations on a possible merger of their businesses. These negotiations continued for several months.
US satellite giant Intelsat has pulled out of merger talks with its Luxembourg rival CNBC. This was reported by the television company CNBC.
Intelsat decided to terminate negotiations after disagreements with SES regarding the vision of business priorities. In addition, there was no clear understanding of whether the merger would generate more value than if Intelsat continued operating as a standalone company, a source familiar with the matter told CNBC.
SES said in a statement that the merger talks ended after the company concluded that “it cannot be certain that the transaction will go through.”
As previously reported, the merger would create a combined US and European business valued at over $10 billion.
Both companies are under increasing pressure as the satellite market shifts away from video content towards data services, which has led to rapid consolidation in the sector. Elon Musk’s SpaceX has changed the market the most as its Starlink business has grown to over 1.5 million customers in less than three years since the service debuted.
The collapse of the merger talks came shortly after SES announced that its CEO, Steve Kollar, would step down at the end of this month. The move came as a surprise to the space industry, as Kollar’s career at SES has spanned more than 20 years.
Last July, the French satellite company Eutelsat announced the start of merger talks with the British company OneWeb. The purpose of this merger is to challenge companies like Elon Musk’s SpaceX with its Starlink project and Amazon.com with its Project Kuiper program.