Longmont-based DigitalGlobe not only has rejected an unsolicited acquisition proposal from GeoEye Inc. but disclosed that it has previously offered to buy its rival.
GeoEye, which is based in Herndon, Va., announced Friday it had made a $792.3 million offer it termed a “friendly transaction.”
A letter dated Sunday from DigitalGlobe chief executive Jeffrey Tarr to GeoEye chief executive Matt O’Connell called GeoEye’s offer “a hostile bid.”
A combined company would create the world’s largest fleet of high-resolution earth-imagery satellites.
Tarr contends GeoEye initiated discussions with DigitalGlobe through an “unsolicited highly conditional private offer” on Feb. 7.
DigitalGlobe responded by offering an all-stock transaction in March and again in April.
Under the proposed deal, Tarr said, DigitalGlobe shareholders would own 60 percent and GeoEye shareholders 40 percent of a combined company.
DigitalGlobe also would have had a majority on the board and DigitalGlobe’s chairman and CEO would continue in those roles in a combined company, Tarr’s letter said.
GeoEye rejected the offer, Tarr said, adding, “At that point, recognizing that the federal government was finalizing its budget process, we felt that we should terminate discussions and withdraw our offer” until the government made a funding decision in September.
Both companies receive about 60 percent of their annual revenues from the federal government, primarily through the National GeoSpatial Intelligence Agency.
“We are disappointed that DigitalGlobe’s board of directors has rejected our highly attractive proposed acquisition,” O’Connell said in a statement. “We believe, and DigitalGlobe appears to agree, that combining these two companies makes clear strategic sense.”
DigitalGlobe is larger than GeoEye in terms of market capitalization, with DigitalGlobe’s market capitalization at about $766 million and GeoEye’s at about $551 million.
DigitalGlobe has about 700 employees, who are mostly based in Colorado. GeoEye has about 130 employees at its Thornton processing-and-operations center, and another 40 in a new facility in Northglenn.
Ann Schrader: 303-954-1976 or aschrader@denverpost.com
