Spacecom, Xinwei begin talks after loss of satellite

SpaceX fire Photo: Reuters

The agreement has been suspended, and the Chinese company has the right to acquire Spacecom on new terms.

A week after the loss of the Amos 6 satellite in an explosion on the SpaceX launch pad in Florida, Spacecom Satellite Communications Ltd. (TASE:SCC) today announced that it is in talks with Chinese company Beijing Xinwei Technology, which agreed to acquire the Israeli company last month.

The negotiations will consider the relevance of the acquisition agreement, in view of the situation, in which the contingent condition of a successful launch of the satellite for the agreement to take effect is clearly not being fulfilled, following the loss of the satellite. Spacecom also announced that other than the question of the binding confidentiality of these complex negotiations and Spacecom's commitment to refrain from negotiating with other potential buyers, the agreement with Beijing Xinwei has been suspended, meaning that the Chinese company has the right to once again acquire the company on new terms.

Despite the agreements preceding the loss of the Amos 6 satellite, it was not clear to what extent the acquisition could go ahead, mainly due to the great importance of Spacecom to the Israeli economy, which requires some of the most extremely stringent regulatory conditions in Israel. The loss of the Amos 6, however, probably means that the Israeli regulators will not have to make this decision.

Published by Globes [online], Israel business news - www.globes-online.com - on September 7, 2016

© Copyright of Globes Publisher Itonut (1983) Ltd. 2016

SpaceX fire Photo: Reuters
SpaceX fire Photo: Reuters
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