Inmarsat takeover to be reviewed by UK competition watchdog

The planned 3.4 billion dollar (£2.7 billion) takeover of British satellite giant Inmarsat is being probed by Britain’s competition watchdog.

The Competition and Markets Authority (CMA) said it was considering whether the acquisition by a consortium including UK private equity firm Apax and US-based Warburg Pincus would lead to a “substantial lessening of competition”.

The consortium, which also includes the Canada Pension Plan Investment Board and the Ontario Teachers’ Pension Plan Board, secured the deal to take Inmarsat private in March.

The 7.21 US dollars (546p) a share offer represented a 46% premium on the stock price before the approach was made.

The deal came after US rival EchoStar Corp walked away from discussions to buy Inmarsat last year when it rejected an offer worth £3.2 billion.

As well as coming under the glare of the competition authorities, the takeover is also expected to be scrutinised by the Government, given its position as a strategic asset.

The CMA is now asking for comments on the takeover deal by July 29.

If approved, the buyout of Inmarsat would also see it return to private equity hands, having previously been majority-owned by Apax, along with Permira, before they floated the business in 2005.