OneWeb: UK to bid hundreds of millions for share of collapsed satellite firm after pulling out of EU project

The government is set to spend hundreds of millions of pounds in a part-purchase deal for struggling US satellite firm OneWeb, it has been reported.

The UK had found itself in need of access to a satellite navigation system after Brexit barred the nation from utilising elements of the European Union’s Galileo project.

Now, the nation is expected to put forward £500m towards OneWeb, a low level satellite company that filed for bankruptcy in March due to the impact of the coronavirus, the Financial Times reports.

Plans had initially been floated for the UK to develop its own sovereign satellite system – a measure likely to have cost the taxpayer between £4bn and £5bn.

Instead, if its bid is successful, the UK is expected to have a stake of 20 per cent in the London-based, US founded firm as part of a wider private sector consortium bid, which is yet to be formally accepted. Bid are due in by Friday, with other offers also understood to be lined up.

The decision to invest is understood to have taken place after a lengthy meeting between the prime minister and chancellor Rishi Sunak – who just last month was warning of a “severe recession, the likes of which we had not seen” due to the impact of the coronavirus lockdown.

The company has so far launched 74 of its planned 650 satellites to build up global broadband offerings. The plan had initially been to have its entire low-flying network in space by the end of the next financial year.

The investment could see the UK in direct competition with some of the biggest names in global business and technology.

Elon Musk, the engineer and entrepreneur founder of SpaceX, is due to launch 60 satellites for his Starlink system by the end of the week.

Meanwhile Jeff Bezos, the Amazon founder and world’s richest man, has put forward his own system – Kuiper. His proposal, which would see 3,200 low orbit satellites launched, would also seek to provide global broadband services.

However states are also heavily invested in the race to develop the systems – with China, the US, EU and Russia all launching their own equivalents.