Inmarsat Plc top shareholder Lansdowne Partners and the company’s directors consider the terms of the deal to be “fair and reasonable” and expect shareholders to unanimously vote in favor of it.

In a significant development, a private equity-led consortium has agreed to acquire Inmarsat Plc for nearly $3.4 billion in cash. In 2018, the British satellite operator had rebuffed a slightly lower bid from U.S. rival EchoStar.

The consortium includes UK-based Apax Partners, U.S.-based Warburg Pincus and Canada Pension Plan Investment Board (CPPIB) and Ontario Teachers’ Pension Plan Board.

Inmarsat shareholders will get $7.21 cash, equivalent to 546 pence per share.

With the news reaching the market, Inmarsat’s shares were up by 8.5% at 549 pence by 0910 GMT, just above the offer price.

The acquisition is likely to come under close scrutiny by the British authorities because of Inmarsat’s position as a strategic asset.

The company was the first international satellite operator to be privatized, and Apax was part of the group that invested in 2003, before taking it public two years later.

Inmarsat is a well known long established provider of communication services to the shipping industry and sees a growing opportunity to supply in-flight broadband services to commercial aircraft.

In its bid to take Inmarsat private, the consortium received support from Lansdowne Partners, Inmarsat’s top shareholder, which has 11.4% stake in the company.

Although the consortium’s approach, was made on January 31, it was disclosed only last week.

According to Inmarsat, its directors consider the terms of the deal to be “fair and reasonable”; it intends to unanimously recommend that shareholders vote in favor of the deal.

Of late Inmarsat has been investing heavily in its networks especially in providing in-flight connectivity; as a result it cut its dividend in 2018.

In recent years, Inmarsat’s stock as come under pressure since its maritime business, which accounts for nearly 41% of its total, has been eroded by competitors.

The company sees its capex moderating after 2020, and hopes to see an improvement in cashflow then. It also expects significant growth in markets including aviation and providing communications to the government.

Inmarsat was advised by J.P. Morgan Cazenove, PJT Partners and Credit Suisse on the financial terms.