A Hanwha subsidiary will take an 8.8% stake in the UK-based satellite connectivity provider OneWeb, helping it increase its funding to $2.7bn since it has resurrected from bankruptcy.
Hanwha Systems, an intelligent technology subsidiary of conglomerate Hanwha, agreed to invest $300m in exchange for an 8.8% stake in satellite internet services provider OneWeb. The deal is set to close in early 2022, with pending regulatory approvals, after which OneWeb will name a board director to represent Hanwha. The investment will increase OneWeb’s overall equity funding to $2.7bn, raised since it officially emerged from bankruptcy in November last year.
OneWeb’s fate has seen an almost 180-degree reversal over the past year and a half. It had to apply for insolvency in March 2020 after it was unable to raise additional funding due to the impact of the covid-19 crisis. The UK government and conglomerate Bharti Enterprises invested $1bn in OneWeb in July 2020, before Bharti increased its stake to 38.6% through a $500m call option agreed in June 2021. Telecoms and internet conglomerate SoftBank also committed $350m for a 30% stake in OneWeb in January 2021, when satellite service Hughes Network Systems also injected $50m. Satellite operator Eutelsat Communications agreed in April 2021 to provide $550m in return for a 24% stake. After Bharti’s call option is completed later this year, Eutelsat, SoftBank and the UK Government will each own a 19.3% share of OneWeb.
Founded in 2012, OneWeb is building a network of some 650 low Earth orbit (LEO) satellites to provide high-speed internet connection, scheduled to complete global coverage in 2022. It currently boasts 254 satellites in orbit and intends to launch more from Baikonur, Kazakhstan. Before its bankruptcy filing, OneWeb had raised $3.4bn of funding from backers including Bharti, Eutelsat, Hughes Network Systems, the SoftBank Vision Fund, conglomerates Grupo Salinas and Virgin Group, beverage producer Coca-Cola, aerospace group Airbus and mobile chipmaker Qualcomm.
OneWeb is part of the broader space and satellite tech area, which has enjoyed much interest from corporate investors over the past few years, as the GCV Analytics bar chart below clearly shows (the figures exclude rounds raised by OneWeb). Even in 2020, we recorded 22 rounds, worth an estimated $670m, raised by businesses from this space. The momentum appears to have been sustained in 2021, when we have already tracked 17 deals, worth an estimated total of $1.27bn, by the beginning of August.
