Comtech Telecommunications Corp. (CMTL) announced it has entered into a definitive agreement to sell its satellite and space communications business to Wavestream Corporation, an affiliate of Gilat Satellite Networks Ltd., for a base purchase price of $157.5 million in cash. The transaction is subject to customary adjustments for cash, indebtedness, and net working capital. In connection with the sale, Comtech also secured amendments to its senior and subordinated credit agreements to obtain lender consent and temporarily suspend certain financial covenant testing.
Key Details
- Transaction Terms: The base purchase price is $157.5 million, with $10 million paid as an advance upon the signing of the agreement on June 14, 2026. The sale is subject to customary closing conditions, including regulatory approvals.
- Credit Agreement Amendments: Comtech amended its senior and subordinated credit agreements to gain lender consent for the divestiture. The amendments also suspend the testing of the fixed charge coverage ratio, net leverage ratio, and minimum EBITDA covenants until the four-quarter period ending July 31, 2027.
- Related Equity Actions: In conjunction with the deal, Comtech issued warrants to certain subordinated lenders to purchase up to 625,000 shares of common stock and entered into an agreement with key investors (affiliates of Magnetar and White Hat) to exchange existing convertible preferred stock for a new series with modified terms.