ViaSat agreed to acquire privately-held WildBlue Communications, which operates Ka-band satellite broadband service across the U.S., in a cash and stock transaction valued at $568 million.
In less than five years since launching its residential broadband satellite service, WildBlue has grown to over 400,000 customers, making it one of the top ISPs in the country.
WildBlue, which is powered exclusively by the ViaSat SurfBeam networking system, pioneered the use of “unprocessed” Ka-band spot beam technology to increase capacity and lower bandwidth costs.
The companies said their merger sets the stage for accelerated growth and expansion of the WildBlue broadband service using ViaSat next generation network technology, which will use a new higher-capacity ViaSat-1 satellite scheduled to launch in early 2011.
“WildBlue and ViaSat have been close partners for nearly a decade and today’s announcement is the logical next step,” said Mark Dankberg, chairman and CEO of ViaSat. “By integrating ViaSat-1 and its ground network technology into the WildBlue operational and distribution platform, we believe we can meaningfully reduce our operational execution risks. Joining forces with ViaSat provides fast and efficient access to next-generation capacity for the WildBlue business and its subscribers. This synergy, coupled with the improved free cash flow profile WildBlue has attained in the last year, has enabled us to structure what we believe is a highly capital efficient transaction that offers immediate financial benefits to ViaSat. In our view, it’s exceptional to be able to make an acquisition with so many strategic benefits under such favorable financial terms.”
“Our new satellite,” Dankberg continues, “will have nearly all of its capacity aimed at those areas where WildBlue growth is constrained by lack of cost-effective bandwidth. The planned launch of ViaSat-1 in early 2011 is expected to multiply WildBlue total network capacity by more than tenfold, and by a factor of over 20 in those areas with the highest demand at a fraction of its current bandwidth costs. The increased bandwidth coupled with next generation ViaSat network technology is expected to enable WildBlue to increase upstream and downstream user speeds by factors of 3 to 5 times in those high-demand areas at current subscription prices, substantially raising the value to consumers.”http://www.wildblue.com
http://www.viasat.com
