Inmarsat share price rises as Eutelsat confirms bid interest
Shares in Inmarsat jumped today after European rival Eutelsat confirmed that it is considering an offer for the London-based satellite firm.
The public interest from Eutelsat could spark a bidding war for the Old Street-headquartered Inmarsat, after US firm Echostar on Friday disclosed a stake in Inmarsat's equity and debt.
Inmarsat has already rejected one approach from Colorado-based Echostar, saying it undervalued the business.
The firm was founded in 1979 by the International Maritime Organization to provide shipping communications, but in 2005 it listed as a private firm which now has 13 satellites used for mobile communications across military, business and charity applications.
Read more: Inmarsat shares soar more than 12 per cent after confirming takeover bid
Paris-based Eutelsat counts 38 satellites in total, claiming an audience of over 274m people for cable and satellite broadcast.
Investors in Inmarsat had suffered a disappointing two years before this month, with its stock price slumping to below 340p in April, having traded well above 1,100p at the end of 2015. However, the interest in the firm has boosted shares back up to 631.8p at the time of writing after more than four per cent gain today.
Inmarsat has also faced heavy criticism for executive pay, with shareholders voting down its remuneration report at its annual meeting in May amid concerns that bosses' pay was too geared towards short-term awards.
Eutelsat now has until 5pm on 23 July to either announce a firm intention to make a bid or to rule itself out for six months. There can be no certainty an offer will be made, Eutelsat said.
Meanwhile, Echostar must make a bid by 6 July or withdraw.
Read more: Inmarsat brought crashing down as emergency maritime monopoly is broken