Eutelsat ups OneWeb stake to become second biggest shareholder
Eutelsat, which last week rejected a takeover offer from Patrick Drahi, has raised its stake in satellite company OneWeb to almost 23%.
The company this morning exercised a call option to increase its stake in the London-based satellite company from 17.6% to 22.9%.
This makes Eutelsat, headquartered in Paris, the second biggest shareholder in OneWeb, behind Indian group Bharti, which has invested US$1 billion in two tranches, and ahead of the UK government, with a $500 million stake. The French state owns 20% of Eutelsat via Banque Publique d’Investissement (BPI).
Today’s Eutelsat investment was of $165 million, on top of the company’s initial investment of $550 million announced in April and completed on 8 September.
Eutelsat said this morning that “the completion of this latest transaction is expected around year-end 2021 subject to regulatory authorisations”.
The investment – 5.3% of OneWeb for $165 million – values the formerly bankrupt company at $3.11 billion.
Rodolphe Belmer (pictured), Eutelsat’s CEO, said this morning: “We are hugely excited to grasp this opportunity to deepen our commitment to OneWeb. The significant progress it has made in the run-up to its now imminent entry into service, together with the vote of confidence demonstrated by the commitment of both its investors and future customers, makes us even more convinced of OneWeb’s right-to-win in the low Earth orbit (LEO) constellation segment.”
OneWeb has run a 100% successful series – so far – of launches, with the most recent, in September, taking the total to 322 satellites of a target, by the middle of next year, of 648, including 50 in-orbit spares.
The next launch is scheduled for 14 October – a week tomorrow – when Arianespace will send up 36 satellites from Vostochny cosmodrome in Russia, close to the Chinese border.
After that there is a gap of more than two months until OneWeb plans two launches in less than a week: 34 from Baikonur in Kazakhstan on 23 December and another 34 from Kourou in French Guiana on 29 December. Kourou is due to launch a further 34 in February 2022.
If all goes well, that will give OneWeb a total of 460 satellites in service – 71% of its target.
Eutelsat said today that its $165 million investment “comes after it delivered a strong FY 2021 performance in terms of cash flow generation and leverage reduction, and is compliant with Eutelsat’s financial framework”.
The company said that its liquidity at the end of June 2021 was €1.9 billion ($2.19 billion) in cash and undrawn credit lines.
After Bharti and Eutelsat, the other investors in OneWeb are the UK government, with $500 million, Japanese investor SoftBank with $350 million, South Korean electronics company Hanwha, with $300 million, and US-based satellite services company Hughes Network Systems with $50 million.
Eutelsat last week firmly rejected a $3.2 billion takeover bid from billionaire telecoms investor Patrick Drahi. The company said its “relevant governance bodies … have unanimously decided not to engage in discussions based on the terms of this proposal”.