Eutelsat’s headquarters in Paris. Photo: Eutelsat

The French government is increasing its stake in Eutelsat Group as part of capital raise, and the French armed forces ministry, DGA, reached a framework agreement for satellite services from the OneWeb Low-Earth Orbit (LEO) constellation.

Under a deal announced June 19, the French government will subscribe to 526.4 million euros ($605 million) of a 1.35 billion euros ($1.55 billion) capital increase. Following the deal close, the French state would hold a stake of 29.99% of Eutelsat Group.

French President Emmanuel Macron called Eutelsat a “strategic jewel” for Europe in the global space industry in remarks at the Paris Air Show on Friday.

“Eutelsat is the only non-American and non-Chinese operator with a Low-Earth Orbit constellation. It is a matter of sovereignty for us,” Macron said in remarks highlighted by the satellite operator.

Eutelsat investors Bharti Space Limited, CMA CGM, and Le Fonds Stratégique de Participations (FSP) are also participating in the raise, and discussions are also underway with the U.K. government, Eutelsat said.

“This transaction reflects our strong commitment towards a major player in satellite connectivity — a strategic sector at the heart of Europe’s digital sovereignty — while fostering remarkable potential for technological innovation and sustainable economic growth,” Eric Lombard, French minister for the Economy, Finance and Industrial and Digital Sovereignty, said in a release.

CMA CGM, a French shipping and logistics company, will invest 100.4 million euros ($115.7 million); Bharti Space Limited will invest 31.4 million euros ($36.2 million); and FSP will invest 57.8 million euros ($66.6 million). 

Eutelsat’s stock price surged 30% on Friday following the investment. 

Bharti Enterprises Chairman Sunil Bharti Mittal, also co-chairman of Eutelsat Group, applauded the government’s investment. “I am delighted that under the leadership of President Macron, the French state has decided to back Eutelsat as the European space champion and increased its shareholding by injecting a sizable investment into the company,” Mittal said in a statement. 

The day before news of the capital raise was released, Eutelsat announced the framework agreement with DGA, which could see DGA procure up to 1 billion euros ($1.15 billion) in LEO services. Eutelsat and DGA signed the framework on June 18 during the Paris Air Show. 

As part of the NEXUS project from the French Ministry of Defence focused on French military space communications, the 10-year framework covers priority access to space resources with notable capacity on the OneWeb constellation and hosting ancillary missions for the French armed forces. It also covers the upgrading and securing of the constellation for military grade use.

Eutelsat noted that this marks a strategic evolution in France’s space strategy to combine military and civilian resources. 

“We are honored at the prospect of supporting the French armed forces through this historic agreement, which underscores the crucial role of Low-Earth Orbit satellite capacity in responding to the requirements of contemporary operational theaters,” commented Eutelsat CEO Jean-Francois Fallacher in a statement. 

While France has affirmed its commitment to Europe’s IRIS² program, Eutelsat said “the urgency of the international situation means that it cannot wait until then.” Eutelsat is one of the leaders of the consortium, along with SES and Hispasat. 

“Eutelsat today offers the only commercially operated LEO constellation capable of meeting stringent military standards ahead of the deployment of IRIS². It provides global coverage, low latency, rapid deployment, and adaptability to mobile use cases, attributes validated by successful large-scale experiments conducted with the French Armed Forces,” Fallacher added. 

Leadership of the French satellite operator has recently said that governments outside of the U.S. have increased interest in the company’s OneWeb LEO solutions. Eutelsat’s LEO services, for example, are currently deployed in Ukraine supporting government and institutional communications.

This story was updated with news of the capital raise