[SatNews] Aireon LLC has completed all necessary milestones to close the third tranche investment from NAV CANADA, totaling $65 million, of which $32.5 million was funded on June 19, 2014, and the second half of the third tranche will be funded in the first quarter of 2015.
These payments will bring NAV CANADA’s cumulative investment in Aireon to $120 million and will increase its fully diluted common equity position, on a post conversion basis, to 36.5 percent. Aireon will also receive the second tranche of investments from its other three air navigation service provider (ANSP) investors: ENAV (Italy), the Irish Aviation Authority (IAA), and Naviair (Denmark) imminently. Total payments of $12.5 million are expected to close on or around July 2, 2014, with an additional $12.5 million in the first quarter of 2015. As a result of these investments, ENAV, IAA and Naviair will collectively receive an additional 3.1 percent ownership interest in Aireon, bringing their cumulative fully diluted common equity position to 10.6 percent on a post conversion basis.
As previously disclosed, NAV CANADA has committed to invest a total of $150 million as preferred interests in Aireon between 2012 and 2017, and ENAV, IAA and Naviair have committed to invest a total of $120 million between 2014 and 2017 for their preferred membership interests. With these investments, Aireon expects to be able to meet the capital requirements to deploy the Aireon system. Upon a partial redemption of Iridium’s common equity and the conversion of all investors’ preferred interests into common interests, both of which are expected to occur in 2018, NAV CANADA will hold 51 percent of the fully diluted common equity interests of Aireon, ENAV will hold 12.5 percent, and each of IAA and Naviair will hold 6 percent, with the remaining 24.5 percent being retained by Iridium.
“We are very pleased with the continued momentum towards the deployment of Aireon(sm), a unique and much-needed service that will deliver more efficient travel to the world’s airlines beginning in 2018,” said Don Thoma, President and CEO, Aireon. “Our partners are leaders in the aviation industry and their ongoing investment, both financially and as advisors to Aireon, has been critical to making the vision of a near real-time, pole-to-pole aircraft surveillance from space a reality.”
Aireon is a joint venture between Iridium Communications Inc. (Nasdaq: IRDM), NAV CANADA, ENAV, IAA, and Naviair, established to launch the Aireon system by hosting ADS-B receiver payloads on Iridium NEXT, Iridium’s second-generation satellite constellation, scheduled for first launch in 2015 and completion in 2017.
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