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Yahsat in agreement with group for Dh6 billion satellite system

The turnkey contract includes designing and construction of Yahsat's two satellites from design concept to post-launch.

Both satellites will be launched within months of one another, allowing Yahsat to provide customers with innovative solutions for broadcasting services, internet trunking via satellite, corporate data networks and backhauling services to telecom operators.

The Yahsat satellites will fulfil the satellite communication requirements of both government, including military, and commercial customers in the Middle East, Africa, Europe and South West Asia.

To be launched in 2010, the system is designed to accommodate the trends of emerging applications in the satellite industry like HDTV and other broadband satellite services.

Initially, Yahsat will mainly focus on leasing the satellite capacity to the existing Satellite Service Providers, TV broadcasters, Internet Service Providers and Telecommunication companies in the region.

The agreement was jointly signed by Waleed Al Mokarrab Al Muhairi, COO of Mubadala and Chairman of Yahsat; François Auque, CEO of EADS Astrium, and Jean Paul Perrier, Chairman of Thales International.

Yahsat represents the latest initiative within Mubadala's ever growing portfolio of information communications technology interests that drives

forward Abu Dhabi's economic diversification strategy.

The global commercial satellite industry alone generated over $80 billion in revenue in 2005 alone, with the highest revenue growth being registered in the Middle East and Africa region.

Waleed Al Mokarrab Al Muhairi, COO of Mubadala and Chairman of Yahsat, told a press conference that demand for satellite communications capacity is booming in the Middle East and North Africa, and this demand is predicted to grow exponentially.

"Strategically, we believe that we have spotted a demand in the market for delivering innovative, quality and cost-efficient solutions to customers in our region, and we are confident that we have engaged the very best partner to help us achieve our mission."

He said the project would be financed through 65 per cent debt financing and remaining by equity. A lead arranger has already been appointed to float a syndicated credit.

François Auque, CEO of EADS Astrium , representing the consortium, said: "Naturally we are delighted to have been selected as Yahsat's partner for the design, construction and management of these two satellite communication systems.

The consortium was chosen based on their impressive combined portfolios and professional management teams.

The satellites produced will fulfill the market demand — using the latest in innovative and technologically advanced solutions. The entire manufacturing stage will take place in Europe and will take approximately 36 months to be completed.

The operational life of the satellites is estimated at 15 years. The Yahsat system will comprise of a space segment including two operational satellites -YahSat 1A and YahSat 1B. 1A is to be stationed at the orbital position of 52.5E.