Eutelsat and OneWeb propose merger in MoU

Both companies estimate there will be over €1.50Bn (US$1.53Bn) of potential incremental value created after tax, net of implementation costs, coming from joint revenues, capital expenditure and cost synergies.

If the proposed merger goes ahead, Eutelsat’s headquarters will remain in France and OneWeb will continue trading and operating under its existing name with headquarters in the UK.

Eutelsat will continue to be listed on Euronext Paris and will apply for a listing on the London Stock Exchange.

This merger will generate growth opportunities in connectivity, said Eutelsat chairman Dominique D’Hinnin, “This combination will accelerate the commercialisation of OneWeb’s fleet, while enhancing the attractiveness of Eutelsat’s growth profile. It carries significant value creation potential, anchored on a balanced mix of revenue, cost and capex synergies. This is truly a game-changer for our industry.”

OneWeb executive chairman Sunil Bharti Mittal expects the combined company will play a pioneering role in providing connectivity to those currently unconnected.

“The combination of Eutelsat and OneWeb represents a significant development in that direction as well as a unique GEO/LEO combination,” he said.

“The positive early results of our service together with our strong pipeline represent a very exciting opportunity in the fast-growing satellite connectivity segment, especially for customers requiring a high-speed, low-latency experience.”

Under the MoU, Eutelsat’s strong cash flow generation will provide visibility and funding to support continued expansion into the LEO market through OneWeb’s next generation of satellites.

The board of directors of the combined group will consist of 15 members including 10 independent directors; seven directors would be proposed by Eutelsat and its key shareholders, and seven directors would be proposed by OneWeb and its shareholders. The remaining shareholder will be chief executive of Eutelsat, Eva Berneke.

Mr D’Hinnin would be proposed as chairman of the combined entity and Mr Mittal as co-chairman and vice-president.

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