1 min read.Updated: 03 Jul 2020, 05:27 PM ISTIshita Guha
The auction was conducted in New York on Thursday as part of OneWeb’s bankruptcy proceedings
The company had filed for Chapter 11 bankruptcy at the end of March after failing to secure $2 billion financing from lead shareholder SoftBank Group
Sunil Mittal’s Bharti Enterprises-led consortium backed by the UK government has won the auction to acquire 20% stake in bankrupt satellite broadband operator, OneWeb.
“The deal will enable OneWeb to complete the construction of a global satellite constellation that will provide enhanced broadband and other services to mobile and fixed terminals in countries around the world," Bharti Enterprises said in a statement on Friday.
The auction was conducted in New York on Thursday as part of OneWeb’s bankruptcy proceedings. The company had filed for Chapter 11 bankruptcy at the end of March after failing to secure $2 billion financing from lead shareholder SoftBank Group.
The deal, where the Borris Johnson-led UK government pledged 500 million pounds ($623 million) in equity, is subject to US court approval, and is expected to close before the end of the year, according to a release from the UK government.
OneWeb operates low earth orbit satellite broadband network. It has 74 satellites in orbit, and had planned to launch 550 more by end of next year.
The bankrupt company has the second largest low earth orbit satellite broadband network, which will lead to direct competition with Elon Musk’s Starlink that has more than 500 in operation and plans at least 50 more this month.
According to a Financial Times report, Johnson last week backed the Bharti-led consortium to keep OneWeb, a London-based company with operations on both sides of the Atlantic, in the UK. As part of the deal, the group has agreed to bring manufacturing of its satellites--currently manufactured in Florida--back to the UK.
In taking a stake in OneWeb, the UK government hopes to secure a substantial position in one of the most rapidly growing segments of the commercial space industry.