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O3b Graphic SES

A graphic of O3b satellites. Photo: O3b

[Via Satellite 01-12-2016] SES has refinanced the remaining debt from its April 2016 $20 million investment in Medium Earth Orbiting (MEO) satellite system O3b Networks. Since acquiring the remaining shares in O3b, SES has refinanced the entire $1.4 billion of gross debt at a materially lower average funding rate, the company said in a statement released Jan. 12. The refinancing will deliver a total of approximately $63 million of annual finance cost savings, starting from 2017.

“O3b’s unique global solution represents an important growth accelerator for SES. The annual financing synergies will allow SES to maximize profitability and drive long-term returns,” said Padraig McCarthy, chief financial officer of SES.

The refinancing was funded using cash that was available at group level, which included the proceeds of the hybrid bond issued by SES in November 2016. SES’s weighted average cost of funding is around 4 percent, which is lower than the average cost of the previous O3b debt.

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