Gilat Satellite Networks (Nasdaq: GILTF) saw its shares soar 20.7% on Thursday after announcing it won a $23 million contract from Brazil's Communications Ministry to set up a satellite-based Internet service.
Under the agreement, Petah Tikva-based Gilat will provide a two-way, satellite Internet service to 3,200 sites across Brazil. Based on Gilat's Skystar 360E VSAT product, the network will serve Brazil's new GESAC program that was established to provide Internet access to millions of citizens in 3,200 communities nationwide, Gilat said.
Gilat chairman and CEO Yoel Gat said, "Our service to the Brazilian government is the latest of several important developments for Gilat in Latin America. With this innovative application of our VSAT products, we continue to maintain our reputation for dependable, economical communications service throughout the region."
Brazil Minister of Communications Juarez Quadros said, "GESAC is a major undertaking that will help bridge the digital divide in Brazil. The program brings Internet access and computer usage to citizens with little or no purchasing power. Gilat has successfully deployed similar services worldwide that have proven to be dependable and easy to maintain."
Gilat Latin America CEO Giora (Gigi) Oron said, "Our services and technology are a perfect fit for the GESAC program. We look forward to helping the Brazilian government to eventually serve millions of citizens with fast, reliable Internet service. This agreement is consistent with our goal of meeting the Internet requirements of progressive government agencies throughout Latin America, as well as continuing our leadership in the Latin American VSAT market."
Gilat shares closed on Thursday on Nasdaq at $0.64. On Wednesday, Gilat announced an agreement with creditors and bondholders to start negotiations on a debt-restructuring plan.
Published by Globes [online] - www.globes.co.il - on October 18, 2002