Another step in the race to bring high-speed internet to the entire planet from space. On Monday, July 25, French satellite operator Eutelsat announced that it had started talks the takeover of the British OneWeb, whose second largest shareholder behind the Indian group Bharti Global. If the operation goes ahead, it will create a pan-European champion in low-orbit telecommunications constellations, located between 550 and 1,200 kilometers from Earth, capable of competing with SpaceX founder Elon Musk’s American Starlink projects or Jeff’s Kuiper To compete with Bezos, CEO of Amazon.
This project, negotiated for a few months under the codename Erika (E for Eutelsat), consists of merging the two companies in equal parts by swapping shares in order to respect the shareholder balance of the two companies, Eutelsat having the bank public investment company Bpifrance with 20% and OneWeb, whose capital is divided between Bharti Global (30%), Eutelsat (23%), the UK government (17.6%), Japan’s Softbank (17.6%) and Korea’s Hanwa (8.8%) is divided. Scoring requires adjustments to achieve parity. If OneWeb is valued at €3.4 billion, Eutelsat is worth nearly €2.4 billion, but paying a special dividend should allow it to close the gap.
The only certainty is that the new company resulting from this merger, tentatively named “New Erika”, will retain its headquarters in France and the management will remain the same as Eutelsat’s current one, with Dominique D’Hinnin as President, and at the managing director Eva Berneke. Bpifrance will have a seat on the board of directors and the UK government will have veto power over OneWeb’s activities.
A very closed club
This new group strengthens its presence in a very closed club due to the high cost of entry, between 5 and 10 billion dollars (4.9 and 9.8 billion euros). To date, apart from OneWeb, there are only four other projects on the western side in which the Chinese are also active: Elon Musk’s 42,000 Starlink satellites, Jeff Bezo’s future Kuiper network, Lightspeed by Canadian Telesat and, since the end of 2021, Boeing.
But OneWeb is the first to be deployed with Starlink and the only one that will have global coverage of the planet with its 648 satellites by the end of 2022. In addition, since December 2021, the operator has been offering services in areas beyond 50e parallel across northern Europe, the United Kingdom, Alaska and Canada.
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