OneWeb looking for an extra $475m after bringing in Eutelsat

OneWeb looking for an extra $475m after bringing in Eutelsat as investor

28 April 2021 | Alan Burkitt-Gray

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Eutelsat has spent US$550 million on a 24% stake in satellite company OneWeb, joining Bharti Global and the UK government — which each spent $500 million — as an equal shareholder.

Softbank also invested $350 million in January, meaning that OneWeb has raised $1.9 billion since it was rescued from bankruptcy protection last year.

OneWeb CEO Neil Masterson said last night: “We are delighted with the investment from Eutelsat, which validates our strategy, technology and commercial approach. We now have 80% of the necessary financing for the Gen 1 fleet, of which nearly 30% is already in space.”

Masterson’s figures imply OneWeb is still looking for an investment of around $475 million from a yet unnamed fifth backer.

He added: “Eutelsat’s global distribution network advances the market entry opportunities for OneWeb and we look forward to working together to capitalise on the growth opportunity and accelerate the pace of execution.”

Eutelsat CEO Rodolphe Belmer (pictured) said: “OneWeb will become our main growth engine outside our broadcast and broadband applications, as we continue to maximise cash-flow extraction from our highly profitable heritage business and grow our fixed broadband vertical leveraging our geostationary assets.”

That comment implies that Eutelsat sees OneWeb in much the same way as SES is working with O3b, though that is a 100% subsidiary. This morning SES told Capacity of its plans to run a new medium Earth orbit (MEO) data service from its new O3b mPower satellite fleet, due to go into service next year.

The timing is similar: OneWeb, which launched another low Earth orbit (LEO) 36 satellites earlier this week, plans to offer service globally in 2022, with a regional start over part of the world by the end of this year.

Belmer said: “We are confident in OneWeb’s right to win thanks to its earliness to market, priority spectrum rights and evolving, scalable technology.”

But OneWeb will be up against not only SES/O3b but also Starlink, the SpaceX unit that is launching thousands of satellites to deliver digital data services. Both OneWeb and Starlink are aiming at the consumer market. OneWeb and O3b mPower are also targeting the wholesale telecoms business.

Sunil Bharti Mittal, the OneWeb executive chairman, told Capacity earlier this year that he expects his Airtel Africa mobile operations to use OneWeb for backhaul as soon as services are available — and he said OneWeb would sell services on equal terms to other mobile carriers.

He said last night: “We are delighted to welcome Eutelsat into OneWeb family. As an open multinational business, we are committed to serving the global needs of governments, businesses and communities across the globe. Together we are stronger, benefiting from the entrepreneurial energy of Bharti, extensive global outreach of UK and long-term expertise of the satellite industry at Eutelsat. OneWeb, with its innovatory approach, is poised to take a leading position in LEO broadband connectivity.”