Intelsat (I) and OneWeb announced that they have entered into a definitive combination agreement pursuant to which Intelsat and OneWeb will merge in a share-for-share transaction. Intelsat and SoftBank Group (SFTBF) also entered into a definitive share purchase agreement pursuant to which SoftBank will invest $1.7 billion in newly issued common and preferred shares of the combined company. Both the merger and the SoftBank investment are subject to, among other conditions, successful completion of debt exchange offers to certain existing Intelsat bondholders as well as receipt of certain regulatory approvals.

The debt exchange offers, announced today, together with the proceeds of the SoftBank investment are intended to reduce Intelsat's debt by approximately $3.6 billion, assuming the minimum level of participation in the debt exchange offers is achieved. Either party can terminate the agreement and SoftBank can terminate its investment if the debt exchange offers have not been successfully completed within 90 days of the date of the agreement. It is expected that, upon the admission of third party limited partners to the SoftBank Vision Fund, and subject to receipt of all applicable regulatory approvals, in accordance with SoftBank Vision Fund agreements, SoftBank's investment position related to the combined company will be offered to the SoftBank Vision Fund for the purpose of transferring SoftBank's shares to the SoftBank Vision Fund. Under the terms of the transactions, SoftBank will acquire a number of common shares of the combined company, resulting in an approximate 39.9% voting stake, and an additional number of non-voting preferred shares for an aggregate cash consideration of approximately $1.7 billion. Any common shares purchased by SoftBank will be for $5.00 per share in cash. In the business combination, OneWeb shareholders will receive Intelsat common shares in exchange for their OneWeb shares. In aggregate, Intelsat will issue to SoftBank and to OneWeb shareholders common shares and preferred shares (the preferred shares for this purpose on an as converted basis) equal in the aggregate to approximately 800 million shares. Intelsat shareholders will retain the Intelsat common shares they currently hold.

The combined company will remain domiciled in Luxembourg, and continue to be listed on the New York Stock Exchange. The combined company, through its subsidiaries, expects to maintain a significant presence in the United States, including at OneWeb's new manufacturing facility in Exploration Park, Florida, and at Intelsat's United States facilities in McLean, Virginia. The Board of Directors of the combined company will be made up of seven directors, including three independent directors, three members selected by SoftBank and one director selected by a current Intelsat shareholder. Intelsat's CEO, Stephen Spengler, will be the CEO of the combined company. OneWeb's Founder and Executive Chairman, Greg Wyler, will be the Executive Chairman of the combined company's Board of Directors. The combination agreement has been approved by the boards of directors of Intelsat and OneWeb. Closing of the transactions is subject to approval by Intelsat and OneWeb shareholders, certain regulatory approvals and other customary closing conditions. The requisite OneWeb and Intelsat shareholders have already committed to vote in favor of the merger and related transactions through the execution of voting and support agreements. Consummation of the merger and the investment by SoftBank are cross-conditioned on one another and also subject to the completion of the Intelsat exchange offers in the 90 days following the execution of the merger and investment documentation, and other closing conditions. The transaction is expected to close late in the third quarter of 2017.