Intelsat closes $400M cash deal for commercial aviation business

McLean-based communications satellite services provider Intelsat Corp. announced Tuesday it has completed the acquisition of in-flight broadband connectivity provider Gogo Inc.’s commercial aviation business for $400 million in cash.

The acquisition was first announced in early September. Intelsat plans to pair its satellite and ground network to Gogo’s customer base of more than 3,000 commercial aircraft.

“Combining Intelsat’s next-generation global telecommunications network with Gogo Commercial Aviation’s leading capabilities and airline relationships will create unprecedented innovation in inflight digital connectivity, unlocking exciting new growth and brand loyalty opportunities across the airline industry,” Intelsat CEO Stephen Spengler said in a statement. “With our powerful, integrated offering, airlines will no longer need to trade off speed, reliability or availability for coverage, even when flying at full capacity in and out of the busiest airport hubs.”

As part of the transaction, John Wade will remain president of Gogo Commercial Aviation, now an Intelsat division. Intelsat’s former senior vice president of strategy and planning, Bruno Fromont, has been named as Intelsat’s chief technology officer, and Jon Cobin has been named as chief strategy officer. Cobin joins Intelsat from Gogo, where he was also chief strategy officer.

“Demand for in-flight broadband is expected to grow at a double-digit rate over the next decade, and we remain committed to long-term success in broadband mobility services,” Spengler said in a statement. “With Gogo Commercial Aviation, we will bring our complementary and collective expertise to help solve our customers’ toughest inflight connectivity and entertainment challenges.”

In May, Intelsat announced it had filed for Chapter 11 bankruptcy protection to spend money on a program that would allow it to build 5G infrastructure under the Federal Communications Commission order. The clearing project will cost Intelstat $1 billion to meet FCC deadlines and will make the company eligible to receive $4.87 billion in accelerated relocation payments. The company’s day-to-day operations will continue as usual, according to Intelsat.

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