Wednesday, November 21, 2012
Nav Canada Formalizes Participation in Aireon
Nav Canada signed an agreement finalizing the terms of its participation in Aireon, a joint venture with Iridium Communications announced in June.
The joint venture will be putting automatic dependent surveillance-broadcast (ADS-B) receivers on Iridium's next-generation satellite constellation, aimed at bringing global, real-time aircraft surveillance for air navigation service providers (ANSP). The new capability will extend air traffic surveillance to vast regions of the globe, promising a quantum leap in fuel savings and avoided greenhouse gas emissions for the world's airlines, the group said.
"Despite the progress being made around the world, we are all limited by the geography of the world's oceans, and by mountain ranges and remote areas that are difficult to reach," said John Crichton, president and CEO of Nav Canada. "Aireon promises to circumvent these geographical barriers, extending the benefits of ADS-B surveillance far beyond what was previously thought possible. In addition, the Aireon partnership opens the door to collaboration with other air navigation service providers in other parts of the world."
The agreement provides for Nav Canada to acquire up to a controlling interest in Aireon, currently a wholly owned subsidiary of Iridium. Under the agreement, Nav Canada will purchase Series A preferred membership interests representing up to 51 percent of the fully diluted equity of Aireon. The aggregate total investment in this venture is up to $150 million.
This investment will be made in five tranches, each subject to the satisfaction of various operational, commercial, regulatory and financial conditions. Payment for the first tranche - amounting to $15 million and representing 5.1 percent of the fully diluted equity of Aireon - was made on Nov. 19. The final tranche is scheduled for late 2017.