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Global Eagle Entertainment to acquire Emerging Markets Communications creating sat comms giant

Global Eagle Entertainment Inc. (GEE) announced that it has signed a definitive agreement to acquire Emerging Markets Communications (EMC), communications services provider to maritime and other mobility markets.

The combined company will become a leading provider of global satellite-based communications and media content serving the rapidly growing aviation and maritime markets and select land-based markets.

Under the agreement, GEE will pay $550m for EMC. EMC shareholders will receive $30m in cash and 6.6m shares of GEE stock at closing and another $25m in 2017, which may be paid in cash or stock at GEE’s election.

The transaction is subject to customary regulatory approvals and closing conditions and is expected to close in the third quarter of 2016.

Dave Davis, ceo of GEE, will be ceo of the combined company and Abel Avellan, founder and ceo of EMC, is expected to serve as GEE's president and chief strategy officer.

EMC is projected to reach $190-200m in 2016 revenue and $55-65 million in Adjusted EBITDA in 2016. GEE projects annual synergies of at least $40m resulting from removing overlap in existing network infrastructure, reduced bandwidth costs, lower development expenses and integrating internal operations.

EMC serves more than 200 customers in over 140 countries and delivers connectivity and content services to all key maritime markets, including cruise lines and ferries, yachts, commercial shipping and energy. EMC acquired MTN Communications last year.

Following the acquisition of EMC, GEE’s global satellite-based connectivity platform will service more than 700 planes, 1,600 vessels, 100,000 cruise ship cabins, and several thousand land-based sites.

Norwegian Cruise Line Holdings recently announced plans to significantly enhance the Internet experience onboard all 23 ships in the company’s fleet as part of a long-term strategic agreement with EMC.  EMC’s patented SpeedNet program delivers popular websites at speeds that mimic high-speed fiber optic networks, similar to those available in homes and offices.