Greenhill SPAC Buying Iridium for $591 Million

(Reuters) – Satellite-phone provider Iridium Holdings LLC agreed to a reverse acquisition with a listed affiliate of investment bank Greenhill & Co (GHL.N: Quote, Profile, Research, Stock Buzz) for about $591 million, the companies said.

The deal will enable Iridium to be debt free and help the provider of mobile satellite services to develop its next generation satellite constellation, the company said in a statement.

Following the closing of the deal, the combined entity will be renamed Iridium Communications Inc and will apply for a listing on Nasdaq.

At the close of the transaction, Iridium’s shareholders will receive about $77 million of cash and 36 million common shares. The companies said the deal is expected to close in the first part of 2009.

Shareholders of GHL Acquisition Corp (GHQ.A: Quote, Profile, Research, Stock Buzz) will own about 55 percent of Iridium’s common shares outstanding after the completion of the deal.

Iridium said its existing management team, including Chief Executive Matt Desch, will continue to lead the combined company. In a separate release, Greenhill said it has agreed to invest $22.9 million in Iridium and expect it to happen in the fourth quarter 2008.

GHL Acquisition’s shares closed at $9.20 on Monday on the American Stock Exchange and those of Greenhill & Co closed at $72.35 on the New York Stock Exchange. (Reporting by Savio D’Souza and Purwa Naveen Raman in Bangalore; Editing by Sue Thomas and Amitha Rajan)