Mergers and Acquisitions, Mergers and Acquisitions, MSP, Content, Vertical markets

Vertical Market MSP Acquisition: Viasat Buys RigNet

Viasat is acquiring vertical market MSP (managed IT services provider) RigNet in a stock deal with an enterprise valuation of $222 million, including RigNet's net debt.

This is M&A deal number three that ChannelE2E has covered so far in 2021. See all technology M&A deals for 2021 and 2020 listed here.

Viasat Acquires RigNet: Deal Details

Viasat of Carlesbad, California, is the global communications company that offers Internet broadband, cybersecurity and satellite services to business, government/military and residential customers. The company employs roughly 5,000 people across 28 offices.

RigNet of Houston, Texas, offers managed communications, cybersecurity, encryption, industrial Internet of Things (IIoT), machine learning and systems integration services. RigNet's revenue was $48.7 million in Q3 2020, down 20 percent from Q3 of 2019, the company disclosed in November 2020.

RigNet is well known for supporting remote managed services that extend out to oil rigs, but RigNet has spent the past couple of years or so diving into application and IIoT opportunities. The company has roughly 650 customers across 52 countries.

Together, Viasat and RigNet will become a "vertically integrated communications company," the buyer says, with a focus on such markets as government, airlines, residential, energy, and more. The buyer's goal is to offer "advanced application solutions that include real-time machine learning and advanced cybersecurity."

The Viasat and RigNet deal is expected to close mid-2021.

Viasat Acquires RigNet: Executive Perspectives & Deal Advisors

In a prepared statement about the deal, RigNet President and CEO Steven Pickett said:

"This is a transformative merger with a company that is highly diversified across a number of important verticals, maintains a strong balance sheet, and is planning to expand its global satellite coverage significantly through its upcoming ViaSat-3 constellation.  We believe the merger will create new opportunities for the combined companies to serve customers even better in energy and to expand more rapidly into other vertical markets.  The combined companies will also be able to further accelerate the growth of RigNet's industry-leading AI-backed machine learning business, Intelie, and our other specialized apps, across a broader customer base than RigNet could have reached independently."

Viasat President and CEO Rick Baldridge

Added Viasat President and CEO Rick Baldridge:

"We believe that RigNet will be a wonderful addition to Viasat's expanding commercial connectivity program.  We admire what Steve and his team have built over the last several years, performing well relative to peers in the energy sector, moving up the stack, and delivering some truly exceptional capabilities that are unique among their competitors.  We see RigNet as an important element in our global expansion efforts and expect to achieve accretive synergies that go well beyond traditional cost savings.  There is tremendous upside potential here, and we look forward to closing the acquisition as quickly as possible so both companies and our stockholders can realize the benefits of the combination and fulfill our vision of connecting everyone, anywhere."

Lazard Middle Market LLC and Baker Botts LLP acted as RigNet's financial and legal advisors, respectively. LionTree Advisors LLC and Latham & Watkins LLP acted as Viasat's financial and legal advisors, respectively.

Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.