Satellite company Eutelsat has secured a €1.35 billion capital injection led by the French government as it continues to position itself as Europe’s sovereign answer to Starlink
Though already an investor, France will become the largest shareholder for the Paris-headquartered business after the deal, supporting the expansion of Eutelsat’s Low Earth Orbit (LEO) network and its involvement in the EU’s €10 billion IRIS2 satellite broadband project.
Recently appointed CEO Jean-François Fallacher said the funding would allow Eutelsat, which recorded revenue of €12 billion last year, to “implement its strategic roadmap” as it entered “a new chapter, centred on the deployment of LEO” and becomes “a central player in the development of the European sovereign space of tomorrow.”
Other investors include French joint insurance investment fund FSP, Indian telco subsidiary Bharti Space, and French shipping giant CMA CGM.
The “contemplated capital increase” could rise further before it is completed by the end of the year, said Eutelsat, referencing discussions with “other interested investors”, including the UK Government.
It declined to comment to The Stack on what any investment by HMG could look like, but the UK does already hold a 10.9% stake in the company.
The move to LEO
While Eutelsat has operated a network of geostationary satellites (GEOs) since its launch in 1977, it has increasingly shifted focus to LEO connectivity as the technology gained popularity as a way to provide secure internet in hard to reach places, as pioneered by SpaceX’s Starlink, and acquired LEO company OneWeb in 2022.
Since the acquisition, OneWeb's satellite network has slowly grown to more than 650, and Eutelsat recently re-outlined its €2 billion plans to launch another 440 by the early 2030s. But it has a long way to go if it is to match Starlink's constellation of 7,500 satellites and Amazon's plans to launch its own 3,236-strong 'Project Kuiper' network by 2029.
Eutelsat’s finances have struggled in recent years, with stock prices largely on a downward trend since 2022, but its funding announcement cited “strong momentum of LEO revenues” and claimed it was set to “play a strategic role” for military and government connectivity in Europe.
A European sovereign alternative
The funding boost also comes after Eutelsat saw record stock price jumps in March amid rumours it could replace Starlink as a broadband provider for Ukraine when SpaceX owner Elon Musk threatened to cut the country off during a spat with Poland’s foreign minister, though a switchover failed to materialise.
Digital sovereignty has continued to be a major issue for European politicians though and Eutelsat is best positioned to take on Starlink, as the continent’s only fully operational LEO provider, though it admits it won't be easy.
Speaking to The Stack earlier this year, Eutelsat Chief Communications Officer Joanna Darlington said Starlink had benefited from the ability to "do everything in-house" thanks to SpaceX's launch capability, while Eutelsat contracts out its own launches, sometimes also to SpaceX.
IRIS2 should help to boost the domestic supply chain though she added, boosting smaller space companies in Europe, "hopefully the knock on effect is that they become more efficient and and that's beneficial for us... So although the competition from Starlink is tough, we believe that we very much have a role to play."
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