French satellite company Eutelsat said it was in talks about a possible all-stock merger with British rival OneWeb. Eutelsat’s statement on Monday said two sources close to the talks told Reuters over the weekend, which was valued at $3.4 billion in its latest funding round, said it was ready to acquire OneWeb, in which Eutelsat already owns a 23% stake.
“Following recent market rumors, Eutelsat Communications has confirmed that it has entered into discussions with fellow OneWeb shareholders regarding a potential all-stock combination to create his leader in global connectivity.”
But the merger would be politically sensitive as it would bring together Indian billionaire Sunil Bhatti Mittal and France, China and the UK as shareholders in the combined group. In a report, Credit Suisse said:
“From an antitrust perspective, the deal is likely to be subject to close scrutiny, and it is likely that there will be political consensus from both the UK and the EU when the UK elects a new prime minister. Eutelsat estimates that the ‘satellite connectivity’ market will be worth about $16 billion by 2030.
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