Thanks, Macron! France poised to give UK huge boost with deal for Galileo alternative

Galileo: David Morris outlines UK’s role in project

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French company Eutelsat announced this week that discussions had begun for a merger with OneWeb to address the “booming connectivity market, estimated to be worth 16 billion dollars by 2030”. The Government bought a £400million share in OneWeb back in July 2020 when the company went bankrupt.

It came after Britain left Galileo, the £8billlion satellite constellation providing positioning, navigation and timing (PNT) services, after Brexit.

While OneWeb satellites provide signals in 3G, 5G, LTE and Wi-Fi for high-speed internet access, experts have said the system can one day be adapted to carry out the same functions as Galileo.

And now, the merger with France could signal a huge boost for the UK, according to Mark Boggett, CEO & Managing Partner of Seraphim Space.

He explained: “The UK has taken a whole range of measures that mean they will continue to benefit going forward from that investment (into OneWeb).

“One of them is that the UK is the preferred location for all of OneWeb’s future launches. Having an anchor customer like OneWeb to launch in Britain is very meaningful.

“The UK Government has also negotiated a guarantee that OneWeb, when it procures for manufacturing, that the UK is the preferred location for the procured businesses. The company is going to stay in the UK and Eutelsat is going to lift on the London stock market.

“I think the measures of requirements to sanction the transaction are really beneficial to the UK and the whole space industry here.

“The company needed a lot of money going forward, so getting the company into a lifted organisation where it can raise money through the public markets I think is the right move for this business to make sure that it is well financed so it can compete in the global market.“

But fears over the merger with Eutelsat have been raised as the UK could lose its “golden share” in the company.

Former Science Minister George Freeman warned: “The UK’s golden share in LEO satellite constellation OneWeb is a key part of the UK’s commercial Space Industry Strategy.

“Unless our rights are protected, this sale to France’s Eutelsat will hand over another key industrial asset to UK competitors.”

But Mr Boggett did not seem to think that this is a problem.

He told “We are still maintaining a very large and influential stake as part of the transaction, we have arranged long-term rights over this.

“I think it is excellent. We do not have to have UK ownership to take benefit.

“If the UK Government was to maintain its position and was going to have to write ever-increasing cheques to support OneWeb, that would not have been perceived as a good thing.

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“Bringing in other investors and making sure the business is well financed while retaining all of these benefits I think is the right move.”

The Eutelsat-OneWeb merger will see a “combined entity” that “would be the first multi-orbit satellite operator offering integrated GEO (geostationary orbit) /LEO solutions”, according to Eutelsat.

Eutelsat specialises in geostationary orbit (GEO) and has a fleet of 35 satellites positioned 36,000 kilometres from the Earth that are largely used for satellite television broadcasting, but also provide internet access.

The deal with OneWeb is still subject to national security and Eutelsat shareholder clearances, but will see OneWeb’s headquarters stay in Britain.

The French firm is also applying for admission to the London Stock Exchange.

Under the deal with Eutelsat, its 36 geostationary orbit satellites would join up with OneWeb’s fleet to generate combined revenues of £1billion, the companies have said.

While the Government has a share in OneWeb, Indian telecoms billionaire Sunil Bharti Mittal holds a stake.

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