Intelsat and OneWeb today laid out plans for a mega-merger aimed at bolstering their satellite internet services, with a $1.8 billion investment boost from SoftBank.
The arrangement is a head-turner, due to the complicated conditions of the deal as well as its ambitious objective. It comes just a couple of months after Japan-based SoftBank announced a $1 billion investment in OneWeb, which is gearing up to launch a constellation of satellites for global internet access.
“We believe that combining Intelsat with OneWeb will create an industry leader unique in its ability to provide affordable broadband anywhere in the world,” Intelsat CEO Stephen Spengler said in a news release.
Spengler is due to head the combined company, which will keep the Intelsat name and remain headquartered in Luxembourg. OneWeb’s founder and executive chairman, Greg Wyler, will be executive chairman of the combined company’s board.
SoftBank will purchase common shares in the company for $5 per share, and take a 39.9 percent voting stake. The $1.7 billion investment and a series of debt exchange offers are aimed at reducing Intelsat’s debt by up to $3.6 billion.
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