Bharti-backed OneWeb to merge with France's Eutelsat in $3.4 billion deal
The all-cash transaction values OneWeb at $3.4 billion, and would be structured as an exchange of OneWeb shares by its shareholders with new shares issued by Eutelsat, such that, at closing, Eutelsat would own 100% of OneWeb, according to an official statement.
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New Delhi, July 26: French satellite operator Eutelsat and Bharti Group-backed OneWeb Tuesday signed an initial merger agreement which will help the two to take on billionaire Elon Musk’s SpaceX Starlink and Amazon’s Project Kuiper.
The all-cash transaction values OneWeb at $3.4 billion, and would be structured as an exchange of OneWeb shares by its shareholders with new shares issued by Eutelsat, such that, at closing, Eutelsat would own 100% of OneWeb, according to an official statement.
Eutelsat will combine its 36-strong fleet of geosynchronous (GEO) satellites with OneWeb’s constellation of 648 Low Earth Orbit (LEO) satellites, of which 428 are currently in orbit.
The combined entity will also bolster the satellite communication capabilities in India, the statement said, adding that it will serve the needs of both the private industry as well as the government."Coming at a crucial time when the Indian space policy is on the anvil, the new entity shall provide further impetus to the recently signed agreement on space coordination between India and France," the companies said.
OneWeb’s Executive Chairman Sunil Bharti Mittal would be the co-chairman of the combined listed entity and Shravin Bharti Mittal would be the second Bharti Director.
OneWeb India will also become a subsidiary of the Eutelsat joint venture post-FDI (foreign direct investment) clearances.“This combination will accelerate the commercialisation of OneWeb’s fleet, while enhancing the attractiveness of Eutelsat’s growth profile. In addition, the combination carries significant value creation potential, anchored on a balanced mix of revenue, cost and capex synergies,” said Dominique D’Hinnin, Eutelsat’s Chairman.
“Our customers are actively seeking a combined GEO/LEO offering leading us towards this important step. Bharti, as the lead shareholder of OneWeb, along with other key shareholders, is looking forward to playing a meaningful role in providing expanded connectivity through the combination of OneWeb and Eutelsat,” added Sunil Bharti Mittal, OneWeb’s Executive Chairman.
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