Intelsat has decided to end its 51% participation in Galaxy Satellite TV Holdings Limited of Hong Kong, whose subsidiary Galaxy Satellite Broadcasting Limited provides local and international pay-TV programming to the Hong Kong market.
Intelsat’s partner in the Galaxy business, TVB, will acquire Intelsat’s share in the joint venture and has agreed to release Intelsat from any future cash contributions.
A related existing agreement for Intelsat’s in-kind contribution of satellite capacity on the IS-709 satellite will end on 31 March 2005. Intelsat’s financial results for the period ended 30 September 2004 will reflect a non-cash charge of approximately $30 million to write down the Galaxy investment.
“We continue to believe that Galaxy’s service offering represents an attractive alternative for pay-TV subscribers in Hong Kong,” said Conny Kullman, CEO of Intelsat.
“Galaxy’s growth has been slower than anticipated, however, and it is not in Intelsat’s strategic interest to invest additional resources and management time on this business.”
