Inmarsat rockets as potential suitor Echostar takes stake

Satellite operator Inmarsat surged as potential suitor, US rival Echostar, disclosed a stake in the company.

A regulatory filing published on Friday showed that Echostar has taken a 3% stake in Inmarsat, and a 10.4% position in its convertible bonds.

The news comes just days after shares in Inmarsat rallied on a report that Echostar was discussing financing options for an improved bid for the London-listed group, which rejected a "highly preliminary" takeover proposal from the company earlier in June.

On Monday, Bloomberg cited people familiar with the matter as saying that no final decision had yet been taken and the American outfit might yet step away.

In a note on 11 June, RBC Capital Markets estimated $3.7bn of potential synergies from a deal, with significant revenue, cost and capex synergies.

"We believe the situation could become a bidding war between multiple potential bidders," RBC added.

At 1520 BST, ISAT shares were up 9.2% to 598.40p.