EchoStar Hughes reinvests in OneWeb project with second US$50 million

by | Jul 28, 2020 | Constellation, Finance, India, Seradata News

The Hughes Network Systems portion of satellite operator EchoStar Corp., announced on 27 July 2020 that it would be investing a second US$50 million into OneWeb. This follows the auction win by a consortium lead by the UK Government and Bharti Global (an Indian multinational conglomerate) for the Chapter 11 company. The consortium’s winning bid was valued at US$1 billion.

Importantly, Hughes has stated that this is an agreement in principle and likely rests on OneWeb successfully emerging from its bankruptcy.

Hughes corporate logo. Courtesy of Hughes Network Systems.

 

Hughes was an investor in the original OneWeb incarnation – coincidentally also to the tune of US$50 million. In return Hughes had received circa ~ US$300 million in contracts relating to the development and manufacturing of the OneWeb ground segment. With this renewal of investment Hughes has likely secured a continuation of this relationship.

The proposed new ownership of OneWeb brings with it further opportunities for Hughes. They and potential new-owner Bharti Global have a joint venture, Hughes Communications India Ltd. (HCIL), previously formed in 2019. This joint venture is aimed at increasing Hughes’ exposure in India whilst expanding Bharti’s reach in the domestic satellite broadband market.

 

Comment by Matthew Wilson:  The pre-existing relationship between Hughes and Bharti (through its majority-owned subsidiary Bharti Airtel Limited) does give potential benefits to the OneWeb project. Most notably would be greater access to the traditionally difficult-to-penetrate Indian market often unavailable to foreign companies. Bharti Airtel is the second largest telecommunications company in India, and second largest mobile network operator globally.

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