The merger is expected to take place in the second half of 2024, until which time Bayanat and Yahsat will continue to operate independently.
Bayanat, an AI-powered geospatial solutions provider, and Yahsat have jointly declared that their respective Boards of Directors have unanimously recommended a merger of the two Abu Dhabi-based entities listed on the Abu Dhabi Securities Exchange (ADX).
The proposed merger is poised to establish an AI-powered space technology champion in the MENA region, boasting an implied market capitalisation exceeding AED 15bn ($4bn). This valuation, based on the closing share prices of both entities as of December 18, 2023, positions the combined entity among the world’s most valuable publicly listed space companies by market capitalisation. The merger foresees substantial global growth opportunities and synergies, creating a vertically integrated entity strategically positioned to capture regional and international prospects in geospatial and mobility solutions, satellite communications, and business intelligence.
With an anticipated strengthened financial position, augmented AI-powered technological capabilities, and a diversified product portfolio, the merged entity will serve as a platform for transformative technologies, enabling space-based services with profound societal and economic impact. The merger is also expected to yield significant revenue synergies and economies of scale, fostering innovation and profitable growth.
The transaction will be executed through a share swap, with Bayanat as the remaining legal entity. Bayanat shareholders will hold approximately 54%, while Yahsat shareholders will have approximately 46% ownership of the combined entity. Independent fairness opinions, obtained in accordance with international best practices, have been secured from Houlihan Lokey and FTI Capital Advisors by Bayanat and Yahsat, respectively.
Major stakeholders in the combined entity will include Group 42 (G42) with approximately 42%, Mubadala Investment Company (Mubadala) with around 29%, and International Holding Company (IHC) with approximately 8%.
Commenting on the deal, Tareq Al Hosani, Chairman of Bayanat, said: “This merger will unite two leading home-grown companies to create the MENA region’s first AI-powered space technology company. Leveraging our complementary assets, capabilities and ambitions will allow us to expand across the space value chain and offer an unparalleled service to our combined customer base. Together, we will leverage our key synergies to reinforce our position as a key engine of growth and strategic solutions provider to the UAE government and its agencies, while expanding our reach to global customers.”
Musabbeh Al Kaabi, Chairman of Yahsat, added: “The merger is a compelling opportunity to amplify value creation for shareholders, utilizing synergies and strategic consolidation to create a technologically advanced champion, further reinforcing the UAEÂ’s position as a leader in the AI and space sectors. The enlarged entity will benefit from accelerated growth potential as a player of scale with enhanced competitive advantage. This growth will be driven by our access to high-growth markets via cutting-edge technologies and an increased base of local and global customers, in addition to strong financials that allow us to pursue more ambitious growth opportunities. We look forward to working together for the realisation of our shared ambition.”
The merger is subject to various conditions, including regulatory approvals from governmental authorities such as the Securities and Commodities Authority and the ADGM Registration Authority, as well as the approval of shareholders representing 75% of the voting rights present and voting at a quorate general assembly meeting of each of Bayanat and Yahsat. Both entities will continue to operate independently until the expected effective date of the merger in the second half of 2024.
