Satellite imagery company GeoEye Inc today said that it has made a friendly offer to buy DigitalGlobe Inc for $792.3 million, in a cash-and-stock deal, in order to create the world's largest fleet of commercial imagery satellites.

GeoEye is offering DigitalGlobe shareholders a total of $17 a share in cash and stock, a 26 per cent premium to its Thursday's closing price.

Jeffrey Tarr, GeoEye CEO Matt O'Connell said the two companies were in discussions on a potential tie-up and that his company has written a letter to DigitalGlobe's CEO staiting the company is "prepared to move quickly" to execute the deal.

He also said the GeoEye would consider restructuring its proposal to increase the cash consideration to 100 per cent or reduce the cash consideration and increase the stock portion of its offer.

''The proposal delivers exceptional value for the combatant commanders, national decision makers, civil users and disaster relief workers, who have a critical need for unclassified commercial imagery. It also provides benefits for the taxpayer. It offers our government a way to get the information it needs while still reducing its funding obligations," O'Connell said.
Founded in 1993 under the name WorldView Imaging Corporation, DigitalGlobe became EarthWatch Incorporated in 1995, before finally becoming DigitalGlobe in 2002.

In January 1994, the company merged with the commercial remote sensing efforts of Ball Aerospace. Ball brought significant communications and optics experience in building satellites and was responsible for the design and construction of the QuickBird sub-meter satellites.

DigitalGlobe contracted with Eastman Kodak and Fokker Space B V for the design, development and fabrication of QuickBird.

DigitalGlobe ImageLibrary today contains over two billion kms of high quality imagery, both current and historical, including strategic places around the globe such as country capitals and other major cities worldwide, thousands of airports, ports and harbours, and millions of km of coastlines and oil basins.

The Longmont, Colorado-based company is also a leading global provider of commercial high-resolution earth imagery products and services, including uses within defence and intelligence, civil agencies, mapping and analysis.

More than 80 per cent of its revenues come from the US government. Commercial customers include oil and gas exploration companies and GPS manufacturers.

Its images and services are incorporated into popular mapping applications such as Google Maps and Microsoft Virtual Earth, as well as into GPS systems from DeLorme and Garmin.
Herndon, Virginia-based GeoEye is the world's largest space imaging company. It was founded in 1992 as a division of Orbital Sciences Corporation and was spun off in 1997.

It changed its name to GeoEye in 2006 after acquiring Denver, Colorado-based Space Imaging for $58 million. Space Imaging, whose main asset was the IKONOS satellite, was founded and controlled by defence equipment manufacturers Raytheon and Lockheed Martin.

GeoEye provides over 2.5 billion kms of satellite map images to Microsoft and Yahoo. Google has exclusive online mapping use of the new GeoEye-1 satellite. It is also a major supplier to the National Geospatial-Intelligence Agency.