TAMPA, Fla. — Eutelsat plans to carve out ground segment infrastructure worth about 790 million euros ($863 million) and then sell most of the teleport service business to a private equity fund, the French fleet operator announced Aug. 9.
The operator is in exclusive talks to sell 80% of the ground station-as-a-service business — comprising land, buildings, antennas and other passive infrastructure assets — to a fund run by EQT Partners of Sweden.
According to Eutelsat, the new business would be the world’s largest pure-play, operator-neutral, ground station-as-a-service company.
The exclusive talks come three months after Eutelsat said external infrastructure investors approached it about creating a network infrastructure investment specialist, similar to those in the terrestrial telecoms market.
“We are proud to become the first satellite operator to embark on this innovative transaction which would allow us to build on the model adopted in other industries, and to optimise the value of our extensive ground network,” Eutelsat CEO Eva Berneke said in an Aug. 9 news release.
Eutelsat plans to remain a long-term shareholder, anchor tenant and partner in the new infrastructure company.
Berneke said the deal would enable the geostationary and low Earth orbit (LEO) satellite operator to “strengthen its financial profile, whilst continuing to rely on the unparalleled quality and reliability of its ground infrastructure.”
Welcome financial boost
Eutelsat reported 1.21 billion euros in revenue for its fiscal year to the end of June, up 5.6% year-on-year when adjusted for foreign exchange rates.
However, adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) fell 12.9% to 718.9 million euros.
Eutelsat’s declining video business continued to weigh on financial performance, falling 6.8% to 651 million euros over the period.
In contrast, revenues from fixed connectivity, government services and mobile connectivity were up 29.1%, 5% and 49.3% — respectively — although combined still represent less than half of the company’s overall business.
Eutelsat is banking on its acquisition of OneWeb’s LEO business last year to fuel its expansion into the growing market for connectivity services.
But ongoing ground station delays continue to hold back global LEO services, which were slated to start early this year after OneWeb deployed all 633 satellites in the constellation, including in-orbit spares.
Berneke said global LEO services are currently expected to begin next spring, once the last eight of 45 gateways are deployed.
Due to OneWeb’s ground segment deployment delays, Eutelsat expects to record roughly flat combined revenues from its four operating verticals instead of growth for its next fiscal year.
