Eutelsat Shares Surge on French Government Backing
Shares of Eutelsat, a key competitor to Starlink in the satellite communications market, experienced a significant rally following the announcement of French government support for a substantial capital raise.
Capital Raise and Investment
The French government is backing a €1.35 billion ($1.55 billion) capital raise that will enable Eutelsat to strengthen its Low Earth Orbit (LEO) capabilities. This investment is crucial for supporting the company's strategic focus on business-to-business and business-to-government services.
French State as Major Shareholder
Following this capital injection, the French state will become Eutelsat's largest shareholder, controlling 29.99% of the capital and voting rights. This move underscores the strategic importance of Eutelsat to France.
Strategic Importance and Military Deal
Eutelsat's significance is further highlighted by a recent 10-year deal with the French armed forces. This agreement grants the military priority access to space resources via Eutelsat's OneWeb LEO satellite constellation.
Market Volatility and Starlink
Eutelsat shares have demonstrated considerable volatility throughout the year. There were earlier rumors about the firm replacing Starlink in Ukraine.
Year to date, the shares are up 69%.
