The Justice Department (DoJ) recently gave commercial satellite imager DigitalGlobe [DGI] antitrust clearance in connection with its pending merger with GeoEye (GEOY), according to a DoJ spokeswoman.
In an internal company email, GeoEye CEO Matt O’Connell recently called the clearance a “significant milestone” toward the completion of the merger.
“Today’s announcement marks a clear and positive signal from the U.S. government that brings additional and needed clarity about our future,” O’Connell said.
DigitalGlobe President and CEO Jeffrey Tarr said recently in an email to GeoEye employees the milestone allows DigitalGlobe to “accelerate” the process of combining the two companies.
Tarr said in his email he expects the merger to be finalized Jan. 31.
The boards of directors of DigitalGlobe and GeoEye unanimously approved July 23 a definitive merger agreement. Finalization of the merger is still contingent on regulatory approval from the Federal Communications Commission (FCC) and National Oceanic and Atmospheric Association (NOAA), according to a DigitalGlobe statement. Shareholders of the two companies voted in favor the merger last summer. DigitalGlobe expects to complete a $1.2 billion refinancing simultaneous with the finalizing of the merger, according to a company statement. This is expected to include a combination of senior notes and senior secured credit facilities.
DigitalGlobe stock was up 1.25 at $28.82 at the close of NYSE business while GeoEye was up 2.50 at $36.85 on NASDAQ.
DigitalGlobe in July agreed to acquire GeoEye in a stock and cash deal valued at $900 million. GeoEye is DigitalGlobe’s primary United States-based competitor in the satellite earth imagery and geospatial analysis market. International customers include the Astrium unit of the European Aeronautic Defence and Space Company.
The merger was set in motion after the National Geospatial-Intelligence Agency (NGA) told GeoEye in June it would not exercise the full year EnhancedView Service Level Agreement option for this contract year. EnhancedView is a program to provide NGA with satellite imagery.