[GRAPHIC OMITTED] Overview of Improved Transaction Economics July 2009 GHL Acquisition Corp. slide01 |
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[GRAPHIC OMITTED] Overview of Improved Transaction Economics July 2009 GHL Acquisition Corp. slide01 |
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Forward Looking Statements
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This communication contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. The words "anticipates", "may",
"can", "believes", "expects", "projects",
"intends", "likely", "will", "to be" and other expressions that are predictions
of or indicate future events, trends or prospects and which do not relate to
historical matters identify forward-looking statements. These forward-looking
statements involve known and unknown risks, uncertainties and other factors
that may cause the actual results, performance or achievements of GHL
Acquisition Corp. ("GHQ") and/or Iridium Holdings LLC ("Iridium") to differ
materially from any future results, performance or achievements expressed or
implied by such forward-looking statements. All statements other than
statements of historical fact are statements that could be deemed
forward-looking statements. These risks and uncertainties include, but are not
limited to, uncertainties regarding the timing of the proposed transaction with
Iridium, whether the transaction will be approved by GHQ's stockholders,
whether the closing conditions will be satisfied (including receipt of
regulatory approvals), as well as industry and economic conditions,
competitive, legal, governmental and technological factors. There is no
assurance that GHQ's or Iridium's expectations will be realized. If one or more
of these risks or uncertainties materialize, or if our underlying assumptions
prove incorrect, actual results may vary materially from those expected,
estimated or projected. Readers are cautioned not to place undue reliance on
these forward-looking statements, which speak only as of the date hereof.
Except for our ongoing obligations to disclose material information under the
Federal securities laws, we undertake no obligation to release publicly any
revisions to any forward-looking statements, to report events or to report the
occurrence of unanticipated events.
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Additional Information and Where to Find It
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This communication is being made with respect to a proposed acquisition and
related transactions involving GHQ and Iridium. In connection with these
proposed transactions,
GHQ has filed with the Securities Exchange Commission ("SEC") a preliminary
proxy statement and intends to mail a definitive proxy statement and other
relevant documents to GHQ's stockholders. The information contained in this
communication is not complete and may be changed. Before making any voting or
investment decisions, GHQ's stockholders and other interested persons are urged
to read GHQ's preliminary proxy statement, and any amendments thereto, and the
definitive proxy statement in connection with GHQ's solicitation of proxies for
the special meeting to be held to approve the acquisition and any other
relevant documents filed with the SEC because they will contain important
information about Iridium, GHQ and the proposed transactions. The definitive
proxy statement will be mailed to GHQ stockholders as of a record date to be
established for voting on the proposed acquisition. Stockholders and other
interested persons will also be able to obtain a copy of the preliminary and
definitive proxy statements once they are available, without charge, at the
SEC's web site at http://www.sec.gov or by directing a request to: GHL
Acquisition
Corp., 300 Park Avenue, 23rd Floor, New York, New York,
telephone: (212) 372-4180.
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Participants in the Solicitation
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GHQ and its directors and officers may be deemed to be participants in the
solicitation of proxies to GHQ's stockholders in connection with the
acquisition. A list of the names of those directors and officers and a
description of their interests in GHQ is contained in GHQ's report on Form 10-K
for the fiscal year ended December 31, 2008, which is filed with the SEC, and
will also be contained in GHQ's proxy statement when it becomes available.
GHQ's stockholders may obtain additional information about the direct and
indirect interests of the participants in the acquisition, by security holdings
or otherwise, by reading GHQ's proxy statement and other materials to be filed
with the SEC as such information becomes available.
Nothing in this communication should be construed as, or is intended to be, a
solicitation for or an offer to provide investment advisory services.
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Steps Taken in Preparation for Merger
Vote
Improving Transaction Economics and
Facilitating Stockholder Approval
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GHQ and Iridium have in recent months [] Transaction Price Reduction
taken a number of steps which both Announced in Late-April
facilitate the closing of the proposed
merger and increase the attractiveness > 15% reduction in consideration to
of the pro- forma company valuation be paid to existing Iridium holders
Today's warrant restructuring > Strong equity market performance
announcement further improves the since then (S&P 500 up 15%; Inmarsat
economics of the merger for GHQ up 13%)
stockholders
[] Elimination of ~3.7 Million GHQ
Warrants Held by Bank of America
> Will be repurchased upon merger
closing for $0.50 each
[] GHQ Warrant Restructuring Announced
Today
> Meaningfully reduces warrant
overhang on GHQ shares post-closing
> Reduces pro-forma,
fully-distributed EBITDA multiple
> ~14.4 million warrants will have
their strike price raised and
expiration date extended and ~12.4
million additional warrants will be
exchanged for GHQ shares and cash
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Details of Warrant Restructuring
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As a result of the warrant [] In total, ~30.5 million GHQ warrant
restructuring, GHQ will have will be repurchased or restructured
dramatically fewer in-the-money upon closing of the acquisition of
warrants outstanding upon closing of Iridium
the Iridium merger, which is
expected to improve share trading > Represents ~69% of the 44.1 million
dynamics and enhance the pro-forma warrants that would otherwise have
valuation for stockholders been outstanding following the
acquisition
> Reduces pro-forma, fully-
distributed EBITDA multiple and
diminishes warrant overhang on GHQ
shares
> Repurchases conducted at
meaningful discount to intrinsic
value assuming Iridium closing;
restructurings significantly raise
strike prices to out-of-the-money
levels
[] Repurchase of ~3.7 million warrants
held by Bank of America (previously
announced)
> Purchase price of $0.50 each or
~$1.8 million in aggregate
[] Restructuring of ~14.4 million
warrants held by various holders
> Strike price increased to 15%
above share offering price in a
future GHQ common equity offering
(subject to a maximum strike price
of $11.50)
> Expiration date extended by two
years to February 2015
> Includes all of the 4.0 million
remaining private placement warrant
held by Greenhill and 0.4 million
warrants held by executives of GHL
Acquisition
[] Repurchase of ~12.4 million warrant
held by various holders
> Aggregate purchase price of ~$3.1
million of cash and ~$12.4 million
of GHQ common stock with the number
of shares based on the offering
price in a future GHQ common equity
offering (subject to minimum of
one-tenth of a share per warrant)
[] Greenhill will own the following
securities post-closing of the
acquisition of Iridium
> ~6.9 million GHQ common shares,
which it received for founding GHQ
and making an $8 million initial
equity investment
> ~1.9 million GHQ common shares,
resulting from conversion of its
$22.9 million convertible note
investment in Iridium
> 4.0 million GHQ warrants with an
out-of-the-money strike price as
described above
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Summary of Post-Transaction Iridium
Balance Sheet
Including Effects of Warrant
Restructuring; Assuming 30%
Redemptions
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Post-merger, Iridium will have a (All Values in Millions) 1/2009
strong balance sheet with minimal Proo Forma
leverage Unrestricted Cash (1)(3) $150.1
Other Current Assets 83.3
Property & Equipment, Net 411.8
Other Long-Term Assets 23.6
Goodwill & Intangibles 130.4
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Total Assets $799.2
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Current Liabilities (1)
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$83.2
Motorola Payable 10.4
Debt (Short-Term & Long-Term) (2) 46.7
Other Liabilities 84.6
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Total Liabilities 224.9
Stockholders' Equity (2) 574.3
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Total Liabilities & Stockholders'
Equity $799.2
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Notes:
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Net Cash (3) $93.0
Fully-Diluted Shares
Outstanding (3)(4) 71.791
Future Potential Warrant
Proceeds (5) $260.8
Source: GHQ Schedule 14A filed 6/8/09,
adjusted for warrant restructuring and
other items below.
(1) Stated prior to payment of $25.5
million tax step-up payment, due
90-days post-closing.
(2) Assumes conversion of Greenhill
convertible note into equity.
(3) Assumes 30% of GHQ's existing
public stockholders elect conversion
for $10.00 in cash per share. Motorola
Payable is treated as debt for purposes
of this calculation.
(4)Based on treasury method for
warrants outstanding and $10.00 share
price.
(5)Based on cash exercise of 13.7
million warrants at $7.00 each and 14.4
million warrants at $11.50 each.
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Valuation Comparison
Including Effects of Warrant
Restructuring
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Iridium's fully-distributed valuation
post-merger represents a 48% discount
to the EBITDA multiple of its closest
competitor, Inmarsat
Iridium's valuation is made even more
attractive by its higher growth and
superior network coverage
(All Values in Millions)
Share Price $10.00 (1) $8.95(2)
x Fully Diluted Shares Outstanding 71.8 (3) 459.5
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Equity Value $717.9 $4,111.0
Net Debt/(Cash) ($93.0) (3) $1,443.8
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Enterprise Value $624.9 $5,554.8
2009E EBITDA $120.0-$130.0 (4) $580.3(5)
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Enterprise Value / 2009E EBITDA 5.0x (6) 9.6x
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2008-2009E EBITDA Growth 16% 9%
Network Coverage Global No Polar Coverage
(1) Estimated conversion amount per share.
(2) Source: Bloomberg as of 7/28/09.
(3) Estimated pro forma as of 3/31/09 assuming 30% of GHQ's existing public
stockholders elect conversion for $10.00 in cash per share.
(4) Source: Operational EBITDA guidance from GHQ press release dated 4/28/09.
(5) Source: Bloomberg consensus estimates.
(6) Based on midpoint of 2009E EBITDA guidance.
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Anticipated Timetable to Closing
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[] Expecting Iridium to Announce Q2 Results During Week of August 10th
[] Anticipating September GHQ Stockholder Vote on Acquisition of Iridium
[] No Further Amendments to Economics or Other Terms Planned
[] Completion Subject to FCC Approval and GHQ Stockholder Approval [GRAPHIC
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