SES’s headquarters and teleport in Betzdorf, Luxembourg. Photo: SES

SES has completed the deal to acquire Intelsat that signals a new era for the company, bringing together two of the largest satellite operators to better compete in the changing satellite market.

The combined company under the name SES has approximately 90 Geostationary Orbit (GEO) and 30 Medium-Earth Orbit (MEO) satellites, and “strategic access to Low Earth orbit (LEO) satellites, the operator said.

SES CEO Adel al Saleh will lead the combined company, which announced a new executive slate with a mix of executives from SES and Intelsat. SES will remain headquartered in Luxembourg and the company will keep a “significant presence” in the United States with its main North American office in McLean, Virginia.

SES announced the deal close early Thursday, after securing final regulatory approvals from U.S. authorities. The acquisition took about a year and a half to close, after it was announced in late April last year.

“Today, we’re not just merging two companies _— we’re creating a stronger company, built for the future,” Al-Saleh commented. “In this new chapter, we are bringing together a powerful mix of talented people, network infrastructure, spectrum, innovation, and global relationships that will allow us to deliver next-generation connectivity and space-enabled services in smarter and quicker ways.”

Intelsat CEO David Wajsgras, who led Intelsat through its post-bankruptcy pivot, is not staying with the company. Wajsgras previously said he would not be in a management role with the new company.

“After more than 60 years of pioneering global connectivity, Intelsat is entering an exciting new era advancing innovation, broader opportunities and greater scale, through combining with SES. This is not an end, but a game-changing new beginning,” Wajsgras said in a LinkedIn post. “I’m honored to hand “the keys” over to Adel Al-Saleh who will lead the newly combined company into the future as SES. I have every confidence in the leadership, the people and the vision ahead.”

“A Multi-Orbit Behomoth is Born”

Via Satellite spoke to a number of analysts about the deal now that it is closed and what it means for SES.

Andrew Cavalier, senior analyst, ABI Research told Via Satellite that “A new multi-orbit behemoth is born” as a result. He added that he thinks SES is well-positioned to tap into markets across the globe and introduce high-quality services across key markets.

“This development also highlights GEO and MEO networks’ strategy to compete with LEO constellations by deploying their own large-scale networks and building into emerging technology areas. Europe also has a solid answer to sovereign space,” he added.

Cavalier pointed to SES gaining a large network and number of contracts/subscribers across the government, aviation, maritime, and cellular backhaul markets to boost its portfolio. “The combined company carries a heritage of both companies and has a visionary leader. The company can and will compete, but we could expect strategic partnerships between networks and more to be the new story on the horizon,” he said.

The key to this deal will be SES’s ability to compete better in the market that is a mix of new upstarts with deep pockets and some of their traditional rivals. Daniel Welch, CEO and co-founder of the Valour Consultancy told Via Satellite that the deal strengthens SES in markets where it was already established, such as defense and government because of the additional assets it has acquired, which will add greater optionality and redundancy. “If the relationship with OneWeb is maintained, then SES has a like-for-like product to compete with Starlink and Kuiper in terms of a low latency network, but we still have concerns in markets like commercial aviation and maritime where Starlink has proven to be very dominant in the last 12 to 24 months and Kuiper is expected to compete hard too,” he added.

In terms of markets, Welch says SES is “already strong” in markets such as defense and mobility, particularly in cruise, and this acquisition is about expanding SES’ reach into commercial and business aviation.

“Clients value redundancy and resilience from connectivity solutions. We anticipate multi-orbit, multi-band will play a significant role for years to come which SES already possessed with its O3b and GEO networks, but now has even more assets to call on, globally,” Welch said.

Challenges

So, what are the main challenges for the new SES? Cavalier believes the main challenge will be deploying the combined assets of both networks for maximum profitability and efficiency in a world where LEO and sovereign space capabilities are now being sought after by everyone. “Their biggest challenge is convincing the market that they still want and need GEO and MEO over the new LEO hype,” he adds.

Another challenge will be how SES deals with the Intelsat brand in commercial aviation. Welch expects there will be a period of time in the roadmap dedicated to educating aviation customers on who SES is. He expects key product offerings, such as 2Ku and FlexExec to remain in place in the short- to medium-term.

“This is two big companies coming together, so there will be challenges to merge the workforce as we’ve seen in other similar deals of this size and scale,” Welch says. “From an external perspective, the company will need to realign on how it goes to market with solutions and services that currently compete with one another, and of course what it does with the OneWeb deal Intelsat has in place today. Both will be top of mind for existing customers.”

Rachel Jewett contributed to this story