Eutelsat and OneWeb claim merger is ‘logical next step’ in deal update

Satellite operator Eutelsat has issued an update on its planned merger with OneWeb alongside its first quarter financial results, describing the move as the “logical next step” for the parties as they build on a cooperation that began with Eutelsat’s initial investment in OneWeb in April 2021.

Eutelsat and key OneWeb shareholders signed a Memorandum of Understanding in July 2022 with a view to combining the two companies in an all-share transaction, whereby Eutelsat and OneWeb shareholders will each hold 50% of the shares of Eutelsat after OneWeb is merged into the organisation.

The companies have since agreed a range of commercial distribution partnerships and joint technical initiatives, including common workstreams to design next generation systems that could take advantage of a hybrid GEO/LEO infrastructure.

Following completion of the merger deal, Eutelsat says that it plans to begin working with OneWeb on the design of the low earth orbit (LEO) operator’s future Gen 2 constellation, due to enter service by early 2028.

As a follow-on constellation to OneWeb’s current network, Gen 2 will benefit from the re-use of existing ground infrastructure and already secured priority filings, while also being designed as part of a broader GEO/LEO structure rather than a standalone entity, the firms said.

Eutelsat and OneWeb note that they have already developed a roadmap for the integration of their respective in-orbit and on-ground assets, culminating in a fully integrated GEO/LEO network with the entry into service of OneWeb’s Gen 2.

This would start by building on the distribution agreements already in place to offer combined GEO/LEO packages through a ‘one-stop-shop’, before gradually converging towards a full mutualisation of networks enabling an integrated offer with automated routing and a single terminal.

“The proposed combination between Eutelsat and OneWeb represents a decisive leap forward for satellite connectivity,” said Eva Berneke, CEO of Eutelsat, and Neil Masterson, CEO of OneWeb, in a joint statement.

“Eutelsat’s initial investment in OneWeb was underpinned by a strong belief that the future growth in connectivity will be driven by both GEO and LEO capacity. This belief has intensified as Eutelsat and OneWeb’s relationship has deepened, and we are confident that moving to the next level, with a full combination, will ensure the potential of the GEO/LEO integration is fully realised, underpinned by compelling financial, strategic, and industrial logic.”

“This ground-breaking combination will create a powerful global player with the financial strength and technical expertise to accelerate both OneWeb’s commercial deployment, and Eutelsat’s pivot to connectivity.”

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Rob O'Dwyer

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