Eutelsat completes $5.8 billion refinancing plan

TAMPA, Fla. — Eutelsat has completed the last step in a 5 billion euro ($5.8 billion) refinancing plan to refresh its OneWeb low Earth orbit (LEO) broadband constellation and support Europe’s IRIS² sovereign connectivity program, the French satellite operator announced March 6.

The company said it successfully closed a 1.5 billion euro bond that activates other debt financing it recently arranged to fund investments for 2026-2029, alongside an equity infusion last year led by the French government, its largest shareholder.

The financing package comes weeks after a sale of passive ground infrastructure fell through, eliminating roughly 550 million euros Eutelsat had expected to raise, though the company said the setback would not affect its ability to fund its growth strategy.

The two-tranche bond offering unlocked:

• About 900 million euros in bank debt, comprising a 400 million euro term loan and a 500 million euro revolving credit facility, to refinance existing loans.

• A 200 million euro amendment with the European Investment Bank, the European Union’s investment arm, that moved the borrower from a subsidiary to the parent company to simplify the capital structure and centralize debt at the group level.

Sebastien Rouge, Eutelsat chief financial officer, said completing the financing package marks a decisive turning point in the company’s transformation into a provider of geostationary and LEO services.

“With this strengthened financial foundation, Eutelsat is well positioned to accelerate the deployment of its multi-orbit strategy, support the future European IRIS² constellation, and reinforce its position as Europe’s leading provider of space connectivity,” he said in a statement.

Positioned for growth

The financing plan covers the 2.2 billion euros Eutelsat expects to need to replenish OneWeb over the next three years as its first generation of satellites approaches the end of their design life.

Most of the 654 satellites currently in OneWeb’s network were launched between 2020 and 2023, giving them expected operational lifetimes extending to around 2027-2028.

Eutelsat has also committed about 2 billion euros for its share of Europe’s IRIS² public-private partnership, which aims to provide services from a multi-orbit constellation around the end of the decade and includes operators SES and Hispasat.

These investments come as Eutelsat pushes to expand its LEO business following its 2023 merger with OneWeb, amid intensifying competition from SpaceX’s Starlink and upcoming constellations from Amazon, Telesat and others also targeting government and enterprise customers.

OneWeb revenues soared nearly 60% year-over-year in the six months ending Dec. 31 to around 111 million euros, on a like-for-like basis excluding currency fluctuations. 

LEO connectivity now accounts for roughly 20% of Eutelsat’s total revenue as its legacy geostationary TV business continues to decline.

Video revenues plummeted 12.3% to roughly 267 million euros, reflecting in part further sanctions on Russian channels imposed following Russia’s invasion of Ukraine.

Meanwhile, connectivity revenues from Eutelsat’s fleet of satellites in geostationary orbit slipped 4.5% to about 197 million euros.

Overall, revenues edged up 0.1% to roughly 592 million euros, driven by OneWeb.

Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) fell 6.1% to about 308 million euros.