Eutelsat and OneWeb Merge29th Jul 2022
Eutelsat Communications and OneWeb signed a Memorandum of Understanding on 26th July to merge the two companies. The aim is to create a powerful, single player in the global connectivity market.
The UK government is a minority shareholder in OneWeb, which owns a Low Earth Orbit (LEO) satellite constellation. Eutelsat is a French satellite operator, which is currently the third-largest satellite operator in the world based on revenue.
Eutelsat will add its fleet of 36 Geostationary Orbit (GEO) satellites to OneWeb’s LEO constellation, which currently already has 428 satellites in orbit. The merged company should see a combined revenue of $ 1.2 billion. Furthermore, the merger addresses a broad range of security issues.
Eutelsat deal good news for UK taxpayers
The UK government invested $500 million in OneWeb two years ago. This means the government is now going to have a considerable stake in what will become a powerful, single, global space business. The new company already has the sound financial footing that is required to leverage the technological innovations needed to compete in this industry.
Under the deal, the UK government keeps its special share and will have exclusive rights over OneWeb. This secures the future of the company at the centre of the joint group’s worldwide LEO business, first-preference rights over industrial opportunities domestically, and national security controls over the network.
Because of this, OneWeb will conduct business in the UK for future procurement for manufacturing on a commercial basis. The UK will also remain the preferred location for OneWeb launches in the future.
Subject to international and UK regulatory approvals
The deal is still subject to international and UK regulatory approvals, including those under the National Security and Investments Act. Shareholders at Eutelsat must also agree on the move. The companies expect to complete the merger within the first half of 2023.