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Inmarsat acquires secure IP solutions provider Segovia

26-11-2009 - Inmarsat has acquired Segovia, a leading provider of secure internet protocol (IP) managed solutions and services to the United States Army and other US military services and government agencies.

The company, based in Virginia, designs, deploys and operates mixed satellite and terrestrial networks. This expertise, together with its secure, global, dedicated IP network infrastructure, has placed it at the centre of the US Department of Defense's (DoD) transformation and modernization programmes.

Andrew Sukawaty, Inmarsat's chairman and chief executive officer, commented: "We are delighted to welcome Segovia into the Inmarsat group. Segovia is ideally positioned to support the US DoD's requirements to deploy secure networks rapidly using combinations of satellite and terrestrial facilities wherever in the world they are required.

Finance
"With Segovia's secure global communications infrastructure and its highly qualified and security cleared staff, we will further strengthen our relationships with key government customers across land, maritime and aeronautical environments, and bring enhanced services to the government sector generally."

Inmarsat will pay an initial consideration of US$110 million and may pay additional amounts depending on future performance over the next three years. Inmarsat expects to finance the transaction from current available liquidity.

For the year ended 31 December 2008, Segovia reported total revenue of US$67 million and net income of US$18 million and had gross assets of US$29 million.

Secure network
After the transaction closes, which is expected in early 2010, current Segovia executive management will operate Segovia as a separate business reporting to Jim Parm, president and chief executive officer of Stratos, Inmarsat's direct distribution business.

"Segovia brings superb technical and customer service capability that has helped reshape the way the US military solves its network deployment challenges, and is complementary to Stratos' existing government business," said Jim Parm.

"By adding Segovia's managed services capability and secure network to our already strong position in the government market, we will further our strategy of bringing essential mobile and portable satellite communications solutions to the US DoD, the largest customer for these services in the world."

Drive demand
Michael Wheeler, president and chief executive officer of Segovia, commented: "We are excited to be joining forces with Inmarsat and Stratos, and we believe the combination will be the perfect platform for reaching the next level in secure global IP networking.

"This transaction will enhance Segovia's standing as a premier supplier of secure network solutions to the US Government."

The DoD's move towards end-to-end rather than piecemeal component solution acquisition is expected to drive demand for Segovia's managed solutions and services in the coming years.

Segovia

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