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Gilat gets Colombia project contract extension
Gilat Satellite Networks Ltd. (Nasdaq: GILT; TASE: GILT) has obtained from Colombia’s Ministry of Communications a one-year extension and amendments for its contract to provide services under the Rural Communitarian Telephony (Compartel II) and Telecentros projects, through December 2010.
The Compartel projects bring satellite telecommunications services to rural areas in Colombia.
The original agreements expired at the end of 2009, and Gilat would not have received further revenue from the projects. The extension for continued service provides for a government subsidy of $1 million per month, dependent upon meeting certain installation schedules, performance indicators, and providing similar services to those provided over the past year. Gilat will also transfer 300 telecenters from their present location to other sites, where no other means of communication are available.
In October, Gilat received $24 million held in trust accounts from the Colombian government, which then sign an initial three-month extension for Compartel II and Telecentros projects.
Gilat’s share fell 0.9% on Nasdaq yesterday to $5.64, giving a market cap of $226 million. The share rose 1.5% in early trading on the TASE today to NIS 21.42.