Indra Finalizes Acquisition of Hispasat from Redeia to Expand Aerospace Sector
Indra is in the final stages of acquiring Hispasat, the satellite management company currently owned by Redeia, according to multiple sources familiar with the situation. This strategic move aims to establish a national champion in the aerospace industry. Both companies are currently finalizing the last details, and barring any last-minute changes, the acquisition will soon be presented to their respective boards for immediate approval.
After months of challenging negotiations, the deal is anticipated to exceed 650 million euros. Representatives from Redeia, Indra, and Hispasat have opted not to provide comments regarding the transaction.
The acquisition process gained momentum when José Vicente de los Mozos, Indra's CEO, indicated the possibility of purchasing Hispasat during a strategic plan presentation in March of the previous year. At that time, Indra expressed its ambition to become a national leader in both space and defense sectors by the end of the decade. Hispasat is a key target for this ambition, not only for its civilian satellite operations but also for its significant military division, Hisdesat. This goal is particularly pertinent given the intensifying global conflicts that have prompted NATO ally states to increase their defense budgets, a scenario from which Indra could benefit.
Market analysts have noted a significant rise in Indra's stock price, which has surged from five euros per share at the end of 2020 to nearly 19 euros today. The company's goal is to consolidate the national space sector, enabling it to compete for large international contracts. Earlier this summer, Indra announced the acquisition of Deimos, Elecnor's space subsidiary, as part of this strategy. There is speculation that Pedro Duque, the astronaut and former Minister of Science, who currently leads Hispasat, may take the reins of Indra's entire space division. Duque is widely recognized in the global space community.
However, this acquisition has not been without its challenges, particularly in aligning the interests of all parties involved. While the strategic rationale behind the acquisition appears sound for both Indra and Redeia, determining a mutually agreeable purchase price has proven to be a complex issue.
Recent changes in leadership within the telecommunications sector, notably the transition from José María Álvarez-Pallete to Ángel Escribano at Telefónica, may have expedited this agreement. Escribano's appointment as CEO of Indra has been interpreted as a favorable sign for the Hispasat acquisition.
Redeia had previously paid 933 million euros for 88.68% of Hispasat's capital from Abertis in 2019. However, various factors have since necessitated a downward adjustment of this price. In 2021, Hispasat recorded a significant impairment of over 122 million euros, reflecting challenges within the satellite business. Industry experts indicate that satellites in lower orbits have become more valuable in recent years, with companies led by American billionaires such as Elon Musk and Jeff Bezos rapidly expanding in this area through ventures like Starlink and Blue Origin.
Analysts point out that Hispasat, along with other similar companies, operates many satellites in higher orbits, which may disadvantage them until they adapt to the changing environment. Comparable firms, such as the French satellite operator Eutelsat, have seen their stock prices sharply decline in recent years, from around 17 euros in 2019 to just above two euros now.
Given these circumstances, the agreed-upon price could surpass 650 million euros. For Redeia, this sale is also seen as advantageous, particularly as the company has faced declining revenues since 2024 due to the expiration of regulatory life for its high-tension assets established before 1998. Following a partial sale of its telecommunications business to KKR for 995 million euros, divesting from Hispasat would enhance Redeia's financial rating, especially as it faces the challenge of investing approximately 1 billion euros annually to integrate a vast array of renewable energy sources in Spain, a goal requiring robust financial health.
The acquisition of Hispasat by Indra is part of a broader trend of potential transactions among major publicly traded companies, especially those with significant ownership stakes held by the SEPI. Another critical aspect for Indra is the possible sale of Minsait, its civil technology division. The company had announced in September that it had initiated a formal sales process for Minsait's payment division, hiring Citi and AZ Capital for this purpose. Although interest has remained lukewarm thus far, European investment funds specializing in technology, such as Apax, have expressed interest in acquiring Minsait entirely.
Additionally, recent developments have sparked speculation that Minsait might be acquired by Telefónica Tech, especially following the appointment of Murtra as CEO of the telecommunications operator. Murtra's previous leadership experience at Indra could facilitate this corporate maneuver, as Minsait could provide the necessary leverage to revitalize Telefónica, whose stock has been under pressure as the telecommunications sector has softened.
