Speedcast Ready to Emerge from Chapter 11 With New CEO
Speedcast gets ready for a new chapter under new CEO Joe Spytek as it prepares to emerge from Chapter 11 bankruptcy. The company announced Monday that the U.S. Bankruptcy Court for the Southern District of Texas confirmed its reorganization plan. Speedcast expects to receive final regulatory approvals and satisfy customary closing conditions to complete the process by the end of the first quarter of 2021. Speedcast will emerge under the ownership of Centerbridge Partners and its affiliates. Centerbridge is a U.S.-based private investment firm.
Spytek joined Speedcast in February 2020 has served as president and COO after being tapped to join the organization to help its turnaround. He is the founder and former CEO of ITC Global, which is now part of Panasonic.
Speedcast is set to emerge with a new $500 million equity investment from Centerbridge, which will be used in part to repay its $285 million debtor-in-possession financing, as well as a permanent reduction of all of the $634 million senior secured debt of the company. The plan does not include recovery for existing shareholders, who will no longer have an equity interest in the reorganized company.
“Speedcast’s best-in-class technology and connectivity solutions provide a leading value proposition to the company’s customers, enhancing productivity, communication and safety,” said Jared Hendricks, senior managing director, Centerbridge. “We continue to be excited about investing behind Joe and the Speedcast team’s innovation and support of its customers and partners in the next phase of growth for the company.”
Speedcast has been one of the big stories in the satellite industry over the past few years, particularly under the leadership of Pierre-Jean Beylier, its ex-CEO. On a buying spree, it bought companies like Caprock Communications, UltiSat, and GlobeComm among others as it aimed to build a position of dominance in the satellite service provider segment of the market.
However, Beylier resigned in February 2020, taking responsibility for the company’s “challenging” 2019. Then, Speedcast filed for bankruptcy in April 2020, citing pressures on the oil and gas and maritime industries, coupled with the COVID-19 pandemic.