TAMPA, Florida — Eutelsat plans to spin off its ground segment infrastructure worth about 790 million euros ($863 million) and then sell most of its teleport services business to a private equity fund, the French fleet operator announced Aug. 9.
The operator is currently in exclusive talks to sell 80 percent of its Ground Station-as-a-Service business – consisting of land, buildings, antennas and other passive infrastructure assets – to a fund managed by Swedish company EQT Partners.
According to Eutelsat, the new company would be the world’s largest pure-play, operator-neutral company providing ground stations as a service.
The exclusive talks come three months after Eutelsat announced that external infrastructure investors had approached the group to set up a specialist in network infrastructure investments similar to those in the terrestrial telecommunications market.
“We are proud to be the first satellite operator to enter into this innovative transaction, which would enable us to build on the model adopted in other industries and optimize the value of our extensive ground network,” said Eutelsat CEO Eva Berneke in a press release on August 9.
Eutelsat plans to remain a long-term shareholder, major tenant and partner of the new infrastructure company.
Berneke said the deal will enable the operator of geostationary and low-Earth satellites to “strengthen its financial profile while continuing to rely on the unparalleled quality and reliability of its ground infrastructure.”
Welcome financial boost
Eutelsat reported sales of 1.21 billion euros for the financial year ending June, an increase of 5.6 percent year-on-year after adjusting for exchange rates.
However, adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) fell by 12.9 percent to 718.9 million euros.
Eutelsat’s declining video business continued to weigh on financial performance, falling by 6.8 percent to EUR 651 million in the reporting period.
In contrast, revenues from fixed-line connections, government services and mobile connections increased by 29.1%, 5% and 49.3% respectively, although together they still account for less than half of the company’s total business.
Eutelsat is banking on last year’s acquisition of OneWeb’s LEO business to fuel its expansion into the growing connectivity services market.
But ongoing delays at ground stations continue to hamper global LEO services, which were scheduled to launch earlier this year after OneWeb deployed all 633 satellites in the constellation, including spare satellites in orbit.
Berneke said global LEO services are expected to start next spring once the last eight of the 45 gateways are operational.
Due to delays in the deployment of OneWeb’s ground segment, Eutelsat does not expect any increase in revenues in its four operating segments for the next financial year, but rather revenues to remain roughly the same.
