A satellite trailblazer saved from bankruptcy in 2020 has agreed a £2.8 billion merger with French peer and shareholder Eutelsat.
OneWeb, a low Earth orbit satellite communications company aiming to improve internet connectivity, became jointly owned by the UK government and Bharti Global after each committed $500m to help it emerge from bankruptcy.
In 2021 Eutelsat, which is listed in Paris, acquired a 24% stake for £400m and a further £217m round soon followed, with South Korean tech giant Hanwha investing £217m. SoftBank and Hughes are also minority shareholders.
A Memorandum of Understanding has today been signed between OneWeb and Eutelsat following approval from the UK government.
Eutelsat is partly supported by investment from the French and Chinese governments – 20% and 5% respectively – and will add its 36-strong fleet of geostationary orbit satellites to OneWeb’s constellation, with 428 satellites already in orbit, to generate combined revenues of €1.2bn.
“The merger is positive news for UK taxpayers: the UK government will now have a significant stake in what will become a single, powerful, global space company, working on the sound financial footing needed to make the most of the technological advantages it has to compete in the highly-competitive global satellite industry, against companies around the world,” read a government statement.
“The UK Government will retain the special share and its exclusive rights over OneWeb – securing the company’s future at the centre of the combined group’s global LEO business, national security controls over the network, and first-preference rights over domestic industrial opportunities.”
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OneWeb’s headquarters will remain in the UK. Eutelsat will continue to be listed on Euronext Paris and will apply for admission to the London Stock Exchange.
The deal will be subject to UK and international regulatory approvals – including through the National Security and Investments Act – and the approval of Eutelsat’s shareholders. The merger is expected to complete in the first half of 2023.
“I am excited about the possibilities of connecting the unconnected. The combination of Eutelsat and OneWeb represents a significant development in that direction as well as a unique GEO/LEO combination,” said Indian billionaire and OneWeb executive chairman Sunil Bharti Mittal, chair of Bharti Global.
Neil Masterson, OneWeb CEO, said: “This combination accelerates our mission to deliver connectivity that will change lives at scale and create a fast-growing, well-funded company which will continue to create significant value for our shareholders.”
Dominique D’Hinnin, Eutelsat’s chairman, said the deal is “truly a game changer for our industry”.
He is to be proposed as chairman of the combined entity, with Mittal as co-chairman. Eva Berneke would continue as CEO of the combined entity.