London: A joint bid from Indian telecommunications tycoon Sunil Mittal and the British government won an auction for bankrupt satellite operator OneWeb, taking Britain a step closer to relaunching its post-Brexit space ambitions.
An arm of Mittal’s Bharti Enterprises Ltd. conglomerate and the U.K. will each commit $500 million in a deal expected to close by year end, the bidders said in e-mailed statements on Friday. Bharti will provide the company with “commercial and operational leadership” while the U.K. will have a final say over future access to the London-based satellite firm’s technology.
OneWeb has been building a constellation of low-Earth orbit satellites to provide internet services outside urban areas. It had raised about $3.3 billion in debt and equity financing from shareholders including SoftBank Group Corp., Airbus SE and Qualcomm Inc. before it collapsed into bankruptcy in March.
“Our access to a global fleet of satellites has the potential to connect millions of people worldwide to broadband, many for the first time,” Business Secretary Alok Sharma said in the statement. “The deal presents the opportunity to further develop our strong advanced manufacturing base right here in the U.K.”
Part of the U.K.’s interest in supporting OneWeb may be to form the basis for a new national navigation system after the European Union froze Britain out of the most secure elements of the bloc’s project, called Galileo. Prime Minister Boris Johnson is trying to attract fresh foreign investment from countries including India, China and the U.S. to help offset the U.K.’s departure from the EU.
In its bankruptcy announcement, the company blamed the financial effects and market turbulence related to the Covid-19 pandemic for its failure to obtain the funding it needed.
The project faces competition from deep-pocketed rivals developing similar small-sat constellations including Elon Musk’s SpaceX Starlink and Jeff Bezos’s Amazon-linked Project Kuiper, as well as from incumbents such as Inmarsat, Intelsat SA and Eutelsat Communications SA.- Bloomberg
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