Eutelsat soars to new heights with OneWeb merger

Yanitsa Boyadzhieva
By Yanitsa Boyadzhieva

Sep 29, 2023

  • Eutelsat and OneWeb have finalised their merger
  • The new company, Eutelsat Group, is claimed to be the world’s first GEO-LEO integrated satellite player
  • With a total fleet exceeding 630 satellites, it has set its sights on leading space technology innovation

French satellite provider Eutelsat has completed its merger with UK satellite operator OneWeb, a move that is expected to see the newly combined company soar to new heights in the low-earth orbit (LEO) and geostationary (GEO) satellite arena.

In a joint statement, the companies hailed the creation of the new entity, Eutelsat Group, which they said is “the first fully integrated GEO-LEO satellite operator”, sporting a fleet of 37 GEO satellites – the Eutelsat network – and a LEO constellation of more than 600 satellites that had been launched by OneWeb.

The new company aims to deliver “global, fully integrated connectivity” powered by a mix of Eutelsat’s GEO satellites, which offer network density and high throughput, and the “low latency and ubiquity” of OneWeb’s LEO constellation.

“This combination confirms Eutelsat as a pioneer in the space industry and a leader in space technology innovation, showcasing its continuous commitment to pushing the boundaries of the satellite landscape,” the companies noted.

The new company hopes that the combination of GEO and LEO services will open up new markets and enable differentiated applications for customers, including fixed connectivity (for backhaul and corporate networks), mobile connectivity (for maritime and in-flight offerings), and secure services for government agency users. Eutelsat noted that its broadcast and video services will remain “integral” to its business.

Great expectations

Both companies place high hopes on the development of their newly born entity: They expect Eutelsat Group’s revenue to grow at a double-digit compound annual growth rate (CAGR) in the medium to long term, hitting around €2bn in annual revenues by 2027. They also forecast that the adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) will also grow at a double-digit CAGR in the same period, outpacing the increase in revenue (though they did not share exact figures).

According to them, their highly praised “unique suite of in-orbit and on-ground assets” is capable of meeting the needs of customers worldwide, with the group pledging to deliver “safe, resilient and environmentally sustainable connectivity to help bridge the digital divide”.

Eutelsat Group’s headquarters will remain in Paris, while OneWeb will act as a subsidiary, operating commercially as Eutelsat OneWeb, based in London. The group is already listed on the Euronext Paris Stock Exchange and, as of today, is also now trading on the London Stock Exchange. It has more than 1,700 employees in total and is run by CEO Eva Berneke.

“We can address a wider range of customer requirements and provide hybrid connectivity services where they are required worldwide, all with industry-leading resilience. As we continue our track record of innovation to develop future generations of satellite technology, we can unlock significant value both for customers and shareholders. The Eutelsat-OneWeb combination has given us the scale, financial strength and business proposition to capitalise on the significant opportunity,” said Berneke.

The new company’s chairman, Dominique D’Hinnin, described the merger as a “historic moment for the satellite industry” as it unites two businesses that are “at the forefront of delivering integrated, seamless and reliable connectivity to customers worldwide”.

Sunil Bharti Mittal, VP and co-chair of Eutelsat Group, stated that the union will be “transformative for communities and businesses worldwide, utilising the unique blend of GEO and LEO technologies.”

The merger ends a tumultuous period for OneWeb, which was declared bankrupt in early 2020 after its biggest single investor, SoftBank, withdrew its support. But only eight months later, in November 2020, it was rescued from bankruptcy protection by the UK government and Indian multinational conglomerate Bharti Global, which then attracted a range of additional investors, including Eutelsat. OneWeb then agreed to merge with Eutelsat in July 2022 – see What’s up with… Eutelsat and OneWeb, BT, 5G in India.

OneWeb expects to be able to deliver global connectivity services to enterprises and communities by the end of 2023, after completing its initial phase of low-earth orbit (LEO) satellite deployments in March.

The company has been actively pursuing collaborations to boost its role in the connectivity market. Some of its big-name partners include UK operator BT, Australian telco Telstra, Japanese telco SoftBank, US operator AT&T, giant Spanish telco Telefónica and Orange, the telco group focused on Europe, Africa and the Middle East.

- Yanitsa Boyadzhieva, Deputy Editor, TelecomTV

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