OTTAWA, June 1, 2009 (GLOBE NEWSWIRE) -- Telesat Canada, the world's fourth largest fixed satellite operator, announced today an agreement to relinquish its leasehold interest in Telstar 10 to APT Satellite Company Limited (APT), the satellite's owner, and to transfer related customer contracts, for a total consideration of US$69,500,000, subject to adjustment. Proceeds will be used to fund replacement satellites or repay debt, in accordance with Telesat's financing arrangements. The transaction announced today is one of the transactions previously disclosed as being under consideration involving the possible disposition of certain of Telesat's international satellites. The parties expect to complete the transaction in July 2009.
Telesat, through its predecessor company, Loral Skynet, has had a lease arrangement with APT on Telstar 10 for almost a decade. APT operates the satellite and also provides technical support to many Telesat customers.
Dan Goldberg, President and CEO of Telesat said: "Given APT's deep involvement with Telstar 10, the complex regulatory environment associated with the satellite, and the upcoming requirement to replace Telstar 10, this transaction makes strong strategic sense for both parties and ensures that the users of Telstar 10 will continue to receive high quality satellite services for the life of the satellite and its replacement."
For the first quarter of 2009, Telstar 10 accounted for approximately 5% of Telesat's revenue and less than 1% of its $5.3 Billion contracted backlog.
Telstar 10, one of Telesat's 12 state-of-the-art satellites, is a hybrid satellite operating in the standard and extended C-bands and the standard Ku-band frequency ranges. The C-Band payload covers Asia, Japan, Australia, and parts of Europe and Africa. The Ku-band payload has focused coverage of China and Korea, including Hong Kong, Macau and Taiwan.
As announced previously, Telesat continues to be in discussions regarding the potential sale of its interests in another of its international satellites. However, Telesat cannot at this time assess the probability of concluding any further transaction under discussion or under what terms, including price, the assets may be sold.
About Telesat (www.telesat.com)
Headquartered in Ottawa, Canada, with offices and facilities around the world, Telesat is the fourth-largest fixed satellite services operator. The company provides reliable and secure satellite-delivered communications solutions to broadcast, telecom, corporate and government customers. Telesat has a global state-of-the-art fleet of 12 satellites, and one additional satellite under construction, and manages the operations of 13 additional satellites for third parties. Telesat is privately held. Its principal shareholders are Canada's Public Sector Pension Investment Board and Loral Space & Communications Inc. (Nasdaq:LORL).
Statement under the Private Securities Litigation Reform Act
This news release may contain statements that are not based on historical fact and are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Statements in this release concerning the beliefs, expectations, intentions, future events, future performance, business prospects and business strategy, including statements regarding projections for 2009 and beyond, are based on several assumptions. If any of these assumptions are not satisfied or prove to be incorrect, actual results could differ materially from those indicated in the forward-looking statements, depending on a variety of factors including, but not limited to, Telesat's ability to implement its business strategy and competition in the market. The information presented in this release reflects Telesat's expectations as of the date of this release. Telesat undertakes no obligation to update or revise the information herein.