Satellite communications giant Yahsat has confirmed that its government services division, Yahsat Government Solutions, has received approval from the UAE government to provide satellite capacity and managed services for a 17-year period.
This mandate, with a value of AED 18.7B, encompasses various operations, maintenance, and technology management services related to ground segment satellite systems and terminals, which were previously managed under a separate contract.
The new mandate is set to replace two existing agreements: the capacity services agreement and the managed services mandate, both of which are scheduled to conclude in November and December 2026.
Under this revised mandate, Yahsat will supply the government with secure and dependable satellite capacity and associated managed services, utilizing the Al Yah 1 and Al Yah 2 satellites currently in orbit, and expanding their capabilities with two new satellites, Al Yah 4 and Al Yah 5, anticipated to launch in 2027 and 2028, respectively.
Mandate to help Yahsat increase contracted future revenues
This agreement significantly boosts the group’s contracted future revenues to AED 25.7B, more than 16 times their 2022 annual revenues, extending the backlog well beyond 2040 and offering assurance and transparency regarding their future cash flows.
In June, the company initiated an authorization to proceed with Airbus for the construction of the two new satellites, according to Gulf Business.
The procurement, which covers spacecraft, ground segment infrastructure, launch services, and insurance, will be funded through Yahsat’s own resources, along with potential funding options currently under review. Additionally, the award includes an advance payment of $1B from the government, expected to be received in 2024.
Musabbeh Al Kaabi, chairman of Yahsat, said: “We are honoured to secure the continued trust of the UAE government to provide critical, secure communication services for a further 17 years beyond 2026.”
From his side, Ali Al Hashemi, group chief executive officer, said: “The mandate positions Yahsat for sustainable future growth, alongside other ambitious projects in the pipeline. Our financial position has never been stronger and we now enjoy a contracted revenue backlog of Dhs25.7bn or over 16 times annual revenues based on backlog figures at the end of the second quarter.”
“Representing one of the largest backlog multiples and strongest balance sheets in the industry, we remain optimistic about providing a broader, more diverse and cutting-edge solutions portfolio to both the government and our customers.”
