Iridium Communications Inc · NASDAQ:IRDM
Iridium Communications — GHL Acquisition — SPAC Merger (September 2008)
31 slides from Iridium Communications's SPAC merger presentation, Sep 23, 2008
Slide 1: Forward Looking Statements
Forward Looking Statements This communication contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The words "anticipates", "may", "can", "believes", "expects", "projects",
Slide 2: Additional Information and Where to Find It
Additional Information and Where to Find It This communication is being made with respect to a proposed acquisition and related transactions involving GHQ and Iridium. In connection with these proposed transactions, GHQ intends to file with the Securities Exchange Commission ("SEC") a preliminary pr
Slide 3: Participants in the Solicitation
Participants in the Solicitation GHQ and its directors and officers may be deemed to be participants in the solicitation of proxies to GHQ's stockholders in connection with the acquisition. A list of the names of those directors and officers and a description of their interests in GHQ is contained i
Slide 4: Table of Contents
Table of Contents 1. Transaction Overview 2. Overview of Iridium GHL Acquisition Corp. 5
Slide 5: Iridium Enters the Public Markets
Iridium Enters the Public Markets o Iridium to become a NASDAQ-listed company through a reverse acquisition transaction with GHL Acquisition Corp. ("GHQ") o Iridium owns and operates the world's largest and most sophisticated commercial satellite network f Provides global communications between peop
Slide 6: Merits of the Transaction
Merits of the Transaction The transaction will enhance value by allowing Iridium to emerge as a public company with no net debt, ready to fund continuing growth o High quality business > One of only two major players in the sector (Inmarsat the other) > Only provider with truly global service > US D
Slide 7: Strong and Consistent Growth
Iridium has been and continues to be on an impressive growth trajectory, recently experiencing some of the strongest months of operation in its history Transaction Overview Strong and Consistent Growth o Significant Long-Term and Recent Growth in Subscribers > Currently more than 305,000 subscribers
Slide 8: Structural Transaction Enhancements
The value of the deal is enhanced by a variety of structural points Transaction Overview Structural Transaction Enhancements Minimal cash paid to Iridium shareholders Existing owners want to maintain significant ownership going forward Cash retained enables Company to be debt free and fund future gr
Slide 9: Iridium Benefits from Greenhill Sponsorship
Transaction Overview Iridium Benefits from Greenhill Sponsorship Why is Iridium entering the public markets through a reverse acquisition with GHQ? GHQ Represents a Unique Sponsor Sponsorship enhances appeal to prospective customers Greenhill telecom expertise and advice Greenhill investing track re
Slide 10: Greenhill's Successful Investment in Global Signal
Transaction Overview Greenhill believes Iridium shares a number of important attributes with its successful investment in Global Signal Greenhill, through its investment funds, initially invested in Global Signal (then named Pinnacle Holdings) in 2002 and generated an 8.0x blended return on its capi
Slide 11: Greenhill's Track Record of Public Company Stewardship
Greenhill's Track Record of Public Company Stewardship Later Sold Public Company Greenhill (GHL) Greenhill & Co. S&P Mid Cap Investment Banking & Brokerage Hercules Offshore (HERO) Heartland Payment Systems (HPY) EXCO Resources (XCO) Energy Transfer (ETE) GHL Acquisition Corp. Note: Returns quoted f
Slide 12: Transaction Summary
Transaction Overview Transaction Summary Acquirer GHL Acquisition Corp. ("GHQ") Iridium Holdings LLC Target Acquisition Structure Cash: $100 million ($22.9 million upfront from Greenhill investment; $77.1 million upon closing from GHQ cash balances) Up to $15 million additional cash pre-closing from
Slide 13: Transaction Summary (cont'd)
Transaction Summary (cont'd) GHL Lockups Lockup on GHQ securities owned by GHL extended to 1 year (from 180 days), except sales via underwritten secondary offerings approved by Iridium Board after 6 months Iridium Shareholder No sales of GHQ shares for 1 year, except sales via underwritten secondary
Slide 14: Transaction Valuation / Operating Comparison
Transaction Valuation / Operating Comparison The Iridium transaction represents an attractive valuation relative to the Company's nearest competitor Iridium's valuation is made even more attractive by its higher growth, lower leverage and superior network coverage ($ in millions, except per share an
Slide 15: Table of Contents
Table of Contents 1. Transaction Overview 2. Overview of Iridium GHL Acquisition Corp. 16
Slide 16: Global Network Providing Unique Capabilities
Iridium is the world's largest and most sophisticated commercial satellite network providing global communications on the move - people, vehicles, aircraft, vessels, assets Global Network Providing Unique Capabilities 66 satellite polar orbiting constellation 8 in-orbit spares A single subscriber de
Slide 17: Leader in Mobile Satellite Communications
Overview of Iridium Leader in Mobile Satellite Communications Fastest growing full-service provider of mobile satellite services (MSS) Highly defensible position with little direct competition Strong and consistent financial performance Attractive MSS market growing at 15% annually through 2015(1) S
Slide 18: Strong Growth Trajectory
Iridium is growing rapidly and consistently, as measured by subscribers, revenues and EBITDA Since June, Iridium's subscriber count has further increased to over 305,000 Strong Growth Trajectory Total Subscribers (in Thousands) 300 280 U.S. Government 32 250 Commercial 234 33% CAGR 200 32 174 150 14
Slide 19: Experienced Management Team
Overview of Iridium Experienced Management Team Matt Desch, CEO More than 28 years of senior executive experience including: CEO, Telcordia Technologies and, President, Global Wireless, Nortel Networks. Chairman of the Board of Airspan Networks and on the board of Starent Networks. Eric Morrison, CF
Slide 20: Strong Position in Growing Market
Overview of Iridium Strong Position in Growing Market Iridium has grown consistently since its re- launch, with subscribers and revenue growing at compound annual rates of 32% and 31% respectively, from 2002-2007 Attractive market for mobile satellite services (MSS) Total market $1.1B in 2007 Commer
Slide 21: Superior Competitive Position
Overview of Iridium Iridium has superior coverage and network advantages relative to competitors and is growing market share Superior Competitive Position TREND COVER SVCS 2007 REVENUE 70% Voice $557M Global Broadband (GEO - 3 + 8 legacy) 100% Voice $261M Global Low Data (LEO - 66 High Data + spares
Slide 22: Global, Premium, and Profitable
Overview of Iridium Global, Premium, and Profitable Iridium Position Relative to Competitors Regional vs. Global Regional Consumer Orientation Consumer Market Positioning Low-end Business Model Maturity Untried Operational Focus Spectrum Play Iridium Position vs. Competition Global Industrial High-e
Slide 23: Strong Presence in Critical Applications
Overview of Iridium Strong Presence in Critical Applications Maritime Aviation 37% of commercial traffic 17,000+ aircraft in international waters equipped Crew calling Flight following Fisheries mgmt Cockpit communications Man-overboard Air safety services High Speed Data SSAS Government Land/Mobile
Slide 24: Embedded Part of DoD Communications Infrastructure
Overview of Iridium Iridium is an embedded part of DoD communications infrastructure since inception, with many new opportunities for growth Total Subscribers (6/30/08) U.S. Government 11% Commercial 89% Defense Department Anchor Tenant Customer Unique high security network that complies with milita
Slide 25: Growth-Oriented Wholesale Distribution Model
Overview of Iridium Growth-Oriented Wholesale Distribution Model Value-Added Manufacturers 43 137 M2M devices Iridium Handset Value-Added Service Partners Value-Added Resellers Developers 1100+ Distributors Distributors Distributors End Customer OpenPort A Growing Network of Iridium Partners Providi
Slide 26: Iridium NEXT - Our Second Generation
Overview of Iridium Iridium expects to fund the capital requirements ($2.7 billion) primarily from internally generated cash flows and proceeds from secondary payloads Management sees no need for additional debt financing until 2014 given transaction with GHQ Expected peak financing need in 2016 of
Slide 27: Opportunity to Share NEXT Infrastructure
Overview of Iridium Opportunity to Share NEXT Infrastructure Including secondary payloads on NEXT may significantly defray overall capital costs Significant interest from Government and industry in sharing NEXT global networked communications infrastructure for space observation Secondary payloads d
Slide 28: Summary Financial Statements
Overview of Iridium Summary Financial Statements Iridium has successfully added subscribers rapidly and profitably over its operating history Since June, Iridium's subscriber count has further increased to over 305,000 ($ in millions, subscriber data in thousands) Years Ended December 31, Six Months
Slide 29: Iridium's Key Growth Strategies
Overview of Iridium Iridium's fixed cost business model allows a significant portion of any incremental new revenue to fall to the bottom line Iridium's Key Growth Strategies Continued Growth in Subscribers and Market Share Superior service offering and coverage advantage Network allows lower overal
Slide 30: Merits of the Transaction
Overview of Iridium Merits of the Transaction The transaction will enhance value by allowing Iridium to emerge as a public company with no net debt, ready to fund continuing growth High quality business One of only two major players in the sector (Inmarsat the other) Only provider with truly global
Slide 31: Merits of the Transaction
Overview of Iridium Merits of the Transaction The transaction will enhance value by allowing Iridium to emerge as a public company with no » Only provider with truly global service net debt, ready to fund » US Department of Defense serves as long-term anchor customer continuing growth High quality b