Shares of Spacecom Communication, operator of the Amos family of satellites, dropped over 6% in the last hour of trading yesterday on NIS 2 million in turnover, well above average.
The fall came after the company released a statement to the stock market saying its interim Amos-5i satellite is running out of fuel. Its resources will not last until the scheduled launch of the Amos-5 in June 2011.
Spacecom will be forced to find alternatives for African telecommunications customers serviced by Amos-5i. The firm estimated the financial damage at $12 million.
Amos-5i started life as AsiaSat 2 and Spacecom contracted for exclusive use of the satellite in January from AsiaSat so it could start providing service to Africa earlier.
Analyst Uri Licht of IBI investment house said Spacecom's strategy was to buy a satellite to use until the launch of Amos-5 and to build its business on the satellite. Since the Amos-5i failed too early, Spacecom will be forced to find other satellites and lease bandwith from them to serve existing customers.
Licht said he expects Spacecom to start building its African customer base for Amos-5 now, based on the alternatives to Amos-5i.