Two ADX-listed entities, Bayanat and Yahsat, have decided to merge, creating one of the world’s most valuable publicly listed space companies by market capitalisation.
This merger aims to create an AI-powered space technology leader in the MENA region, with an implied market capitalisation exceeding Dh15 billion (over $4 billion), based on both entities’ closing share prices as of December 18, 2023, the last day of trading prior to the announcement of the merger.
The combined entity will be vertically integrated and optimally positioned to capture regional and international opportunities in geospatial and mobility solutions, satellite communications and business intelligence, the companies said on Tuesday.
With a strengthened financial position, enhanced AI-powered technological capabilities and a diversified product portfolio, the combination will establish a platform for transformative technologies to enable space-based services with significant impact on societies and economies. Moreover, it is expected to benefit from considerable revenue synergies and economies of scale to best position the organisation for innovation and profitable growth.
“This merger will unite two leading home-grown companies to create the MENA region’s first AI-powered space technology company,” said HE Tareq Al Hosani, Chairman of Bayanat. “Leveraging our complementary assets, capabilities, and ambitions will allow us to expand across the space value chain and offer an unparalleled service to our combined customer base.”
“Together, we will leverage our key synergies to reinforce our position as a key engine of growth and strategic solutions provider to the UAE government and its agencies while expanding our reach to global customers.”
Through a share swap resulting in Bayanat remaining as the legal entity, Bayanat shareholders will hold about 54% and Yahsat shareholders approximately 46% of the combined entity. Notably, Houlihan Lokey and FTI Capital Advisors have provided independent fairness opinions for Bayanat and Yahsat, respectively, adhering to international best practices.
The ownership structure of the combined entity will consist of G42, Mubadala Investment Company, and International Holding Company (IHC), with approximate holdings of 42%, 29%, and 8%, respectively.
“The enlarged entity will benefit from accelerated growth potential as a player of scale with enhanced competitive advantage,” said Musabbeh Al Kaabi, Chairman of Yahsat. “This growth will be driven by our access to high-growth markets via cutting-edge technologies and an increased base of local and global customers, in addition to strong financials that allow us to pursue more ambitious growth opportunities.”
However, the merger’s completion is contingent on various conditions, including regulatory approvals from governmental bodies such as the Securities and Commodities Authority and the ADGM Registration Authority. Additionally, approval from shareholders representing 75% of the voting rights at general assembly meetings of Bayanat and Yahsat is required.
Until the merger’s effective date, anticipated in the second half of 2024, both Bayanat and Yahsat will continue to operate independently.
