Hungarian IT firm 4iG has continued its moves into the telco space with the acquisition of satellite operator SpaceCom for $65 million.
Founded as Freesoft in 1990, Budapest Stock Exchange-listed 4iG provides a number of IT services including software development, managed services, and cybersecurity, as well as data center and cloud management offerings. In the last year the company has expanded into new areas, founding its own satellite firm and buying both local satellite and telecoms firms.
This latest deal sees 4iG’s two subsidiaries, Hunagro DigiTel and CarpathiaSat, enter into a preliminary agreement with Israeli satellite firm Space-Communication Ltd. (SpaceCom).
SpaceCom, listed on the Tel Aviv Stock Exchange, is a satellite operator offering broadcast as well as broadband satellite services. The company has four geosynchronous AMOS satellites globally, including AMOS 3 which provides services to Hungary.
“I think that the transaction is not only decisive for the growth of our group of companies, as we are preparing an agreement that could open new doors for Hungary in the space industry and in the field of space telecommunications,” said Gellért Jászai, 4iG president and CEO. “Spacecom's decades of technological experience, innovative solutions, global market knowledge and a team of experts can provide CarpathiaSat with a great deal of support for the development and launch of the first Hungarian commercial satellite.”
SpaceCom’s AMOS 3 has been in a geostationary orbit above Hungary since 2004. The lease agreement between SpaceCom and the Hungarian state expires in 2024, after which CarpathiaSat plans to launch a new commercial satellite in its place. The $65 million deal is expected to close in the fall of 2021.
“The new satellite’s traits and characteristics will be developed by Spacecom,” said Spacecom CEO Dan Zajicek. “Completion of the deal will strengthen and widen Spacecom’s operating potential in Eastern Europe and create joint ventures and synergy between the companies.”
SpaceNews reports that Chinese conglomerate Beijing Xinwei Technology Group came close to buying Spacecom in 2016 for around $285 million, but the deal collapsed after a SpaceX launchpad explosion destroyed Spacecom’s AMOS 6 satellite. Although it was insured, Spacecom lost anchor customers including the satellite’s co-leaser Facebook in the wake of the explosion.
This is the latest move 4iG has made around space. Last year the company announced a new joint venture with state-owned telecoms and broadcasting company Antenna Hungária to set up CarpathiaSat Hungarian Space Telecommunications Corporation (CarpathiaSat), with the IT firm owning the majority stake in the new Geostrationy satellite firm.
This is also the second satellite acquisition the company has made this year, having acquired a 75 percent stake in the Hungarian satellite telecommunications company Hungaro Digitel in May.
Though the SpaceCom deal is its first international buy, 4iG has been on an acquisition spree across various sectors in 2021; The company recently entered the domestic telco space through the purchase of the Hungarian interests of the telco DIGI Group, and also acquired both data center services firm SpaceNET and IT firm Poli Computer.
“We intend to play an important role for DIGI in the creation of the national telecommunications platform planned jointly with Antenna Hungária, with which we can open a new chapter in the Hungarian telecommunications market,” Jászai said of the DIGI deal.
