Inmarsat has rebuffed a takeover offer from US-based satellite operator EchoStar, valuing the London-based business at £3.2 billion.

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Inmarsat has rebuffed a takeover offer from US-based satellite operator EchoStar, valuing the London-based business at £3.2 billion.

The dollar-denominated offer of approximately 532p per share was dismissed by Inmarsat’s board of directors soon after its receipt on July 3rd. The £3.2 billion valuation includes all of the UK group’s equity and convertible debt.

“After carefully considering the revised conditional proposal with its advisers the board rejected the proposal on 4 July 2018 on the basis that it very significantly undervalued Inmarsat and its standalone prospects,” said Inmarsat, in a July 6th statement.

“The board remains highly confident in the independent strategy and prospects of Inmarsat.”

This is the second bid made by EchoStar to acquire the company, after an opening bid in June –  described as “highly preliminary” – was immediately turned down. Subsequent to making that bid EchoStar disclosed that it has built a shareholding worth about 3 per cent of the British company, and that it holds 10.4 per cent of Inmarsat’s convertible bonds.

Following the initial bid Inmarsat set a July 6th deadline for EchoStar to return with a more attractive offer. After that second bid was also rebuffed, EchoStar had said that it intended to continue “to seek engagement with the board of Inmarsat on a constructive basis, with a view to agreeing the terms of a recommended transaction.”

However, the American company later that same day announced via the London Stock Exchange that it would not be making an offer for the company.

Inmarsat’s share price had dropped to a closing price below 485p on the news that the second takeover bid had been rejected, a fall of approximately 10 per cent, before recovering to move beyond 500p after markets reopened on Monday. Speculation about the acquisition had caused the share price to surge from under 400p at the start of June to a high of more than 632p on June 25th.

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