NewSat

NewSat

Type	Public company
Traded as	ASX: NWT OTCQX: NWTLY
Industry	Satellite communication
Founder	Adrian Ballintine
Headquarters	Australia
Key people	Adrian Ballintine (CEO)
Revenue	US$ 39.3 million (2013)[1]
Net income	US$ 10.449 million (2013)[1]
Total assets	US$ 124.655 million (2013)[1]
Total equity	US$ 206.430 million (2013)[1]
Website	www.newsat.com

As of 2011 NewSat is the largest independent satellite communications provider in Australia.^[2] Its satellites, VSATs and teleports provide coverage to 75% of the earth’s surface. NewSat CEO Adrian Ballintine and Microsoft co-founder Paul Allen founded the company in 1987. NewSat started as a multimedia business. It survived the dotcom crash to evolve into a fully-fledged satellite communications company. Most NewSat customers are located in Australia, the Middle East and Africa. Having made a $39.7 million loss in the second half of 2014, and with $300 million in outstanding loan repayments, NewSat was placed in administration in mid April 2015.^[3]

Jabiru Fleet

NewSat-owned Jabiru is Australia's first independently owned satellite operator to manage a fleet of commercial Ku- and Ka-band satellites. Its Jabiru-1 Ka-band satellite, scheduled to take off in 2016, will cater to mobile communications carrier and private and public organizations across the Middle East, Africa, Asia and Australia.^[4]

In mid February 2014 NewSat had secured funding (around US$400 million) that allowed to proceed with construction of the Jabiru-1 satellite, and had paid Lockheed Martin close to US$170 million, out of an expected total cost of US$268 million.^[5] Total project cost was expected to be US$600 (AU$664) million, including US$116 million for the rocket to put the satellite in orbit in the second half of 2015. At that time, NewSat confirmed that 18% capacity of the satellite had already been sold, at an estimated value of AU$644 million.^[5]

Funding issues

In early August 2014, NewSat got a conditional waiver over alleged breaches of financial facilities, to continue with the Jabiru-1 project. At that time, it was expected that the satellite would be assembled in late 2014 and tested in 2015.^[6] In late January 2015, Lockheed Martin, the Jabiru-1 satellite builder, issued NewSat a termination notice due to a defaulted payment of US$21 million (A$26.5 million); giving a period of up to 90 days to make payments without further impact.^[7]

In late March 2015, NewSat requested a trading halt due to ongoing issues with project financing, which would remain in place until negotiations with US lenders are completed.^[8] On 8 April 2015 NewSat announced that "COFACE Lender Group" would not support the waiver and not advance funds. This represents US$160 Million (AU$209M) lost, requiring additional US$70 Million in capital that needs to be raised to keep the project alive. If funding difficulties continue, Lockheed Martin could terminate the manufacturing agreement; the company already provided a termination notice. Arianespace, the launcher provider, also issued such a notice recently. NewSat expressed confidence that Jabiru-1 could still be launched in the first half of 2016 if new capital could be raised or funding recommenced.^[9] In mid-April 2015, NewSat was placed into administration to resolve the troubled financial situation and save the project; at the same time a temporary order was issued in the US to keep the construction contracts with Lockheed Martin and Arianespace.^[10]

References