Gilat Satellite Networks, which enjoys strong content placement in aviation including as an aero modem provider, has inked a definitive agreement to acquire satcom terminal solutions specialist Stellar Blu Solutions, with the intent of making Stellar Blu a “core component” of the Israeli company’s inflight connectivity growth strategy.
Under the terms of its agreement with Stellar Blu, Gilat will make an initial cash payment of $98 million at closing, subject to customary adjustments, and up to an additional $147 million payable in cash “subject to the achievement of post-closing financial and business goals”. Gilat intends to finance the acquisition with its existing cash reserves and an external credit facility.
Now headquartered in San Diego, Stellar Blu has made strong headway in supporting IFC with its Sidewinder Ku-band electronically steered antenna (ESA) package. The first-generation, single-beam, multi-orbit Sidewinder ESA is capable of talking to Low Earth Orbit (LEO) or geostationary (GEO) satellites and switching between the two.
Approved for use on the Eutelsat OneWeb LEO network, Sidewinder is being used by aero ISPs Intelsat and Panasonic Avionics as the basis for their nextgen ESA-based hybrid GEO/LEO inflight connectivity solutions, and is in line for offerability at Boeing. Intelsat has secured commitments covering over 800 airplanes, including clutch retrofit deals at American Airlines, Alaska Airlines and Air Canada, plus a Boeing 737 MAX linefit arrangement with Japan Airlines. A dual-beam next-gen version of Sidewinder will in time enable airlines to simultaneously connect with both LEO and GEO satellites, offering a step change in the hardware’s flexibility and performance.
Sidewinder is a no-radome ESA solution. It has been flight-tested on Intelsat’s CRJ700 testbed, and is expected to start supporting IFC on aircraft when STCs are secured, retrofits are completed, and the Eutelsat OneWeb LEO aero service enters revenue service. This image is from Gilat’s slide deck about the deal.
“The acquisition is a major milestone in Gilat’s growth strategy to expand its business further into the IFC market,” said Gilat CEO Adi Sfadia in a statement. “Moreover, we believe that with Gilat’s global reach, we can bring Stellar Blu’s innovative solutions to other high-end mobility markets in need of an ESA solution. Jointly, we will provide Stellar Blu customers with a comprehensive support network.”
“We see strong synergies between the companies and are looking forward to working with Stellar Blu Solutions’ leadership in support of these world class customers,” he added. To that end, Gilat has developed a LEO-specific ESA, called ESR 2030, for Satcom Direct’s OneWeb LEO program to support inflight connectivity in business aviation, government and defense. And Gilat management confided to RGN at the Satellite 2024 conference and exhibition in Washington D.C. that it has completed roughly 80% of the development for a dual-beam aero ESA, dubbed ESA 2040.
In acquiring Stellar Blu Solutions, Gilat will be positioned to further grow its linefit and retrofit aero ESA work, including extending that work to the Ka-band and other mobility applications.
Gilat’s agreement to acquire Stellar Blu has been approved by both Gilat’s board of directors and by Stellar Blu’s board of managers. The closing of the transaction, said Gilat, is subject to certain regulatory approvals, including the receipt of clearance from the Committee on Foreign Investment in the United States (CFIUS) and the U.S. Federal Trade Commission (FTC) and the Department of Justice (DOJ) under the HSR Act, as well as other customary closing conditions. It is expected to close in the second half of 2024.
Annual revenues from the acquired business are expected to range between $100 million to $150 million beginning in 2025, based on Stellar Blu’s existing backlog. And the acquisition is expected to be accretive on a non GAAP basis starting the second half of 2025, noted Gilat.
The news follows another recent ESA-focused company buy, that of Thales’ acquisition of Get SAT, as first reported by RGN.
Roughly 7,000 aircraft are flying with Gilat solutions. The firm is among the top providers of aero modems. Image: Gilat
Related Articles:
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- Japan Airlines taps linefit Intelsat multi-orbit IFC for 737 MAXs
- Gilat Satellite Networks details scope of aero work
- American Airlines picks Intelsat ESA connectivity for nearly 500 RJs
- Stellar Blu to develop multi-orbit, multi-beam aero ESA with BAE tiles
- Get SAT CEO Kfir Benjamin details dual-beam aero ESA work
- Panasonic’s Wade on how OneWeb LEO differentiates in aero
- Alaska picks Intelsat multi-orbit satcom for E175s, in industry first
Featured image credited to istock.com/Leyn
