EMBRATEL AND SES/ASTRA LAUNCH BROADBAND SERVICES STRATEGIC PARTNERSHIP
BusinessWire, 07/27/2000 11:23
RIO DE JANEIRO--(BUSINESS WIRE)--July 27, 2000--
Company to Provide Pan Regional High-Speed Internet Broadband
Services Via Satellite in the Latin America US$1 Billion Market
WorldCom's Embratel Participacoes S.A., the controlling company of the Brazilian national telecommunications operator, Embratel, announces that Embratel, has entered into a definitive agreement with Societe Europeenne des Satellites S.A. (SES), the Luxembourg-based operator of ASTRA, Europe's leading Direct-To-Home (DTH) satellite system.
As part of the agreement, SES will purchase a 20 percent interest in Embratel Satellite Division, a pan-regional Latin America Internet high-speed broadband satellite operations company based in Rio de Janeiro. The transaction is subject to approval by the relevant regulatory authorities and is anticipated to close in the third quarter of 2000.
Embratel operates the largest fleet of satellites in South America. Together with SES, they will capitalize on the pent-up demand by introducing broadband Internet services directly to homes and businesses via satellite in Latin America, one of the fastest-growing broadband markets in the world. Embratel, through its satellite division plans to obtain Ku band capabilities in the near future. The Transaction
SES will take 20 percent of the Embratel Satellite subsidiary for a total entity value of US$675 million. SES retains an option to acquire an additional 10 percent interest. The two companies plan to invest an additional US$900 million over the next five years on a pro-rata ownership basis.
Completion of the transaction is subject to the approval of the relevant Brazilian telecommunications and competition authorities ANATEL and CADE.
"Building on Embratel's established base of more than 7 million C-band dishes, our unrivaled leadership in data and Internet transmission services, Embratel Satellite Division will capitalize on SES' expertise in DTH and offer much needed broadband services directly to homes and businesses in Latin America," said Dan Crawford, chairman of Embratel Participacoes S.A. Strategic Development Agreements
SES and Embratel have also entered into Shareholder and Strategic Partnership Agreements. These agreements focus on their shared interest in developing both the service portfolio and geographical penetration of Embratel Satellite Division. The orbital positions and frequency spectrum available through this investment will notably permit the rapid expansion of new broadband multimedia services, starting with Brazil, the biggest market in Latin America. The Latin America Broadband Market
Embratel Satellite Division will first commercialize high-speed Internet broadband services in Brazil, which represents nearly half of all broadband Internet subscribers in Latin America. Thereafter, the company will serve Mercosur, the Andean region followed by Mexico and Central America. According to industry experts, the total number of broadband subscribers in Latin America represents 2.5 million today and is expected to surge to 10 million by 2005. The Latin America broadband subscriber market is growing at a compounded annual growth rate of 32 percent and is valued at US$1 billion today and expected to skyrocket to $4 billion by 2005. Broadband via satellite represents 25 percent of the total broadband market.
Romain Bausch, CEO and chairman of the Management Committee of SES, said: "Establishing an SES presence over the Americas has been and continues to be an integral part of our company's ambition to create a global broadband satellite network. Through our strategic investments in AsiaSat, NSAB and now Embratel, we will be able to interconnect the European ASTRA and Sirius satellites with the Asian/Pacific AsiaSats and Latin American Brazilsats to offer services spanning four continents." About Embratel Satellite Division:
Embratel pioneered satellite services in Brazil in 1985 and continues to operate the largest satellite fleet in Latin America.
Embratel Satellite Dvision owns and operates the Brazilian Satellite Telecommunications System (SBTS) at the orbital positions 65(Degree) West, 70(Degree) West, 84(Degree) West and 92(Degree) West. SBTS currently operates four geostationary satellites: Brasilsats A2, B1, B2 and B3, carrying a total of 102 C-band transponders, with a fill rate in excess of 90 percent. The Brasilsat B4 satellite will be launched in August 2000 with 28 1/8C-band 3/8 transponders to replace the A2 satellite currently operating in inclined orbit at 65(Degree) West. The Brasilsat satellites provide TV and radio broadcasting, data transmission, telephony, trunking, Internet and multimedia services in South America, with primary focus on Brazil.
Embratel Satellite Division based in Rio de Janeiro, Brazil, started operations in 1976 through the INTELSAT satellite system and in 1985 transitioned to the Brasilsat satellite system. About SES/ASTRA:
Societe Europeenne des Satellites S.A. (SES) is the operator of ASTRA, Europe's leading direct-to-home Satellite System. Via nine active satellites at the orbital positions of 19.2(degree) East and 28.2(degree) East, ASTRA transmits in analogue and digital more than 950 different television and radio channels as well as multimedia and Internet services to an audience of close to 78 million homes in Europe. Four additional satellites are under construction and due for launch before end 2001.
SES is also a major shareholder in AsiaSat (34.13% since January 15th, 1999) and announced on July 17, 2000, that it has entered into definitive agreements to acquire a 50% ownership in Nordic Satellite Company NSAB, subject to approval by competition authorities.
SES is a pioneer of interactive and multimedia services through SES Multimedia, a wholly owned subsidiary. SES Multimedia operates the ASTRA-Net platform, enabling service and content providers to transmit data directly, via satellite, to personal computers in businesses and homes across Europe.
SES is the first European satellite operator to commercially exploit the Ka-band frequency for interactive and multimedia services in Europe. In 2000, SES will commence commercial trials of the first operational DVB-RCS broadband satellite return channel system, serving the growing market in Western and Central Europe for 2-way asymmetric, high-speed broadband collection and delivery of multimedia.
SES securities are listed on the Luxembourg Stock Exchange (symbol: SES) and the Frankfurt Stock Exchange (symbol: SDSL).
Additional information about ASTRA can be found at: www.ses-astra.com About Embratel:
WorldCom owns a controlling stake in Embratel Participacoes S.A., the company that controls the Brazilian national telecommunications operator Embratel, trades on New York Stock Exchange (NYSE): EMT and the Sao Paulo Stock Exchange in Brazil (BOVSPA): EBTP3, EBTP4. Embratel is the main provider of high-speed data transmission and Internet services in Brazil with the largest fiber-optic broadband network covering over 26,000kilometers. The company also provides long distance, international and 40 other innovative communication services. Embratel has the largest long distance telecommunications network in Latin America and owns the only national and international Brazilian telecommunications network directly connected to thousands of companies. For more information, please visit embratel.net.br. |
