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Gilat extends service contract with Colombian Ministry

Colombia’s Ministry of Communications has extended the contract which it signed with Gilat Satellite Networks by one year. Gilat will also transfer 300 telecentres to parts of Colombia without other means of communication...

Gilat Satellite Networks has announced that the Ministry of Communications in Colombia has extended and amended the agreements for the provision of services under the Rural Communitarian Telephony (Compartel II) and Telecentros projects for an additional one-year term, through to December 2010.

Gilat had previously announced that these agreements were to end December 31, 2009 and, as such, the company could not anticipate further revenues from these projects. The current extension for continued service provides for a government subsidy of approximately US$1 million per month, which is dependent upon meeting certain installation schedules, performance indicators and providing similar services to those provided over the past year. Under the terms of the amended agreement, Gilat has also agreed to transfer 300 telecentres from their present location to other sites, where no other means of communication are available.

“The extended agreement enables us to continue working towards the goal of ensuring that every Colombian is connected and informed, especially in the most remote regions of the country, which is one of the main goals of our Ministry,” stated Daniel Medina, Deputy Minister of Technology Information and Communications.“To this end, we get involved in helping reach the less affluent Colombians, in places where no one else would assist without the help of the government and the participation and commitment of Gilat.”

In prior releases, Gilat announced that it had reached new agreements with the Colombian Ministry of Communications which, if Gilat performed, were to enable the release of US$24 million from trust accounts. These amounts have been fully released and in October 2009 the government signed an initial three months extension of the agreements.

* Gilat was founded in 1987 and has shipped over 750,000 Very Small Aperture Terminals (VSATs) to more than 85 countries across six continents. Gilat’s headquarters is located in Petah Tikva, Israel. It has 16 sales and service offices worldwide. Gilat markets a full line of high-performance VSATs under the SkyEdge and SkyEdge II Product Family.

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