(Reuters) -Activist investor Carronade Capital Management is urging Viasat to split its broadband and defense units, the Financial Times reported on Thursday, citing people familiar with the matter.
Carronade, which holds a 2.3% stake in the satellite communications firm, plans to issue an open letter to shareholders calling for the defense unit to be spun off — a move it says could unlock as much as $11 billion in value for both businesses, the report said.
Viasat's shares rose 3.6% after the report.
The investment firm estimates Viasat's total valuation could rise more than 500% if the defense unit is separated, according to the report.
Carronade continues to build its stake in Viasat and also holds $30 million of the company's debt, FT said.
The activist investor has held multiple meetings with Viasat’s management and described the discussions as “constructive,” the report added.
Viasat has launched a strategic review, but Carronade is pushing to accelerate the process. Its letter is expected to be released just days ahead of Viasat’s earnings report on Aug. 5.
Both Carronade and Viasat did not immediately respond to Reuters requests for comment.
Viasat's communication services unit posted revenue of $3.3 billion for fiscal year 2025, while the defense segment brought in $1.22 billion.
The company expects mid-teen percentage revenue growth in the defense unit for fiscal 2026, driven by strong double-digit gains in information security, cyber defense, and space and mission systems.
(Reporting by Juby Babu in Mexico City; Editing by Tasim Zahid)