Eutelsat to raise €1.35bn to fund low Earth orbit satellite expansion and boost European space autonomy

Eutelsat Group (Euronext Paris / London Stock Exchange: ETL), the Paris-based satellite communications provider, has unveiled a €1.35 billion capital increase anchored by the French State and leading institutional investors. The equity raise aims to accelerate Eutelsat’s long-term strategy centered on low Earth orbit (LEO) satellite infrastructure and its role in European sovereign defense systems.

The capital raise includes a €716 million reserved share offering and a €634 million rights issue, both slated for completion by the end of calendar year 2025. The transaction is supported by the French government’s investment arm Agence des Participations de l’État (APE), Bharti Space, CMA CGM, and Le Fonds Stratégique de Participations (FSP).

This marks a pivotal financial move for Eutelsat, following its 2023 merger with OneWeb, which made it the only operator globally to offer fully integrated GEO-LEO services exclusively to professional and government clients.

Why is Eutelsat raising €1.35 billion and what does this mean for its satellite strategy going forward?

Eutelsat’s strategic rationale behind the equity raise centers on capitalizing on robust demand in the LEO-enabled connectivity market. According to institutional estimates, the global LEO B2B connectivity segment is forecast to grow at a compound annual growth rate (CAGR) of 28% through 2029, expanding fivefold from its $2.1 billion valuation in 2025.

By securing €1.35 billion in fresh equity, Eutelsat seeks to expand its orbital capacity, optimize hybrid GEO-LEO offerings, and strengthen its financial flexibility as it scales next-generation networks for government, defense, and enterprise clients. The funds will also be deployed to support the IRIS² initiative—a flagship EU satellite program designed to ensure regional space and connectivity sovereignty.

The strategic value of Eutelsat’s hybrid infrastructure is underscored by its coverage expansion and service quality improvements post-merger. Institutional sentiment indicates that the capital raise positions Eutelsat favorably to extract long-term value from both defense-sector partnerships and the growing mobility connectivity segment spanning land, sea, and air.

How will Eutelsat’s dual capital raise be structured and who are the anchor investors in the transaction?

The contemplated €1.35 billion capital raise comprises two tranches. The first involves a reserved capital increase of €716 million priced at €4 per share—representing a 32% premium over Eutelsat’s 30-day volume-weighted average price. The second tranche is a rights issue worth €634 million, open to all existing shareholders.

The reserved capital increase will be subscribed by APE (€526.4 million), Bharti Space Limited (€31.4 million), CMA CGM (€100.4 million), and FSP (€57.8 million), with all four investors also committed to participating pro-rata in the follow-up rights issue. These commitments are subject to shareholder approval, regulatory clearance, and execution of a revised non-concerting shareholder agreement.

In preparation for the capital raise, APE will purchase the stake currently held by Bpifrance Participations at the subscription price. The transaction will also see a reshuffling of board representation, with the French State gaining a board seat as part of the governance realignment.

What strategic role will Eutelsat play in European defense and satellite connectivity through IRIS² and Nexus?

Eutelsat’s leading position in the European space landscape is reflected in its active role in defense-oriented programs. The group recently signed a landmark 10-year agreement worth up to €1 billion with France’s Ministry of the Armed Forces under the Nexus program, which aims to integrate civil and military satellite infrastructure.

Additionally, Eutelsat stands as the largest private investor in IRIS² (Infrastructure for Resilience, Interconnectivity and Security by Satellite), the European Commission’s multi-orbit satellite initiative. The project is designed to provide secure and resilient communication channels for the EU and its Member States, positioning Eutelsat as a cornerstone of future European defense communications.

Analysts note that Eutelsat’s spectrum rights, commercial infrastructure, and existing LEO capabilities confer it a unique advantage in both policy-backed and open-market segments, particularly as spectrum coordination limits new entrants into LEO.

How will Eutelsat deploy the new capital to expand its LEO constellation and meet long-term capex targets?

The capital raise is aligned with Eutelsat’s broader financing roadmap, which includes debt refinancing and export credit strategies. The group expects to reduce its net debt-to-EBITDA ratio to approximately 2.5x by the end of FY 2025–26, enhancing its eligibility for long-term credit markets.

On the capital expenditure front, Eutelsat forecasts gross capex of €1.0 to €1.1 billion in FY 2025–26, primarily allocated to the procurement and deployment of LEO satellites. This includes the December 2024 order of 100 satellites and an additional 340 satellites to scale the current constellation.

Between 2024–25 and 2028–29, a further €2 billion will be invested in LEO infrastructure under the Gen-1 follow-on program. Separately, IRIS² development will require an estimated €2 billion starting in 2027–28, while maintenance capex for GEO systems will continue to ensure service continuity.

What is the revenue forecast and investor sentiment for Eutelsat over the next five years?

Eutelsat has issued robust medium-term guidance, projecting revenues between €1.5 and €1.7 billion by FY 2028–29. This is driven by accelerating LEO demand and improved service monetization. The group expects EBITDA margin expansion of several percentage points, targeting a margin of at least 60% over the same period.

For FY 2025–26, the French satellite firm anticipates flat revenues and a slightly lower EBITDA margin relative to FY 2024–25, impacted by sanctions affecting its Video segment. However, LEO revenues are expected to grow 50% year-over-year, reflecting strong commercial momentum.

Institutional investors have responded positively to Eutelsat’s strategic clarity, hybrid satellite approach, and commitment to sovereign infrastructure programs. Analysts expect the group’s deleveraging path and predictable capex to attract long-duration capital as market conditions stabilize.

What is the outlook for Eutelsat as it positions itself at the center of European space infrastructure?

Eutelsat’s future outlook is defined by its dual mandate: bridging the global digital divide with advanced B2B and B2G connectivity, while anchoring European strategic autonomy in space. The €1.35 billion capital raise, backed by state and institutional players, equips the operator to scale at speed while maintaining a resilient financial profile.

CEO Jean-François Fallacher highlighted that “Eutelsat enters a new chapter, centered on the deployment of LEO,” calling the funding round “a major step” in executing its roadmap. He noted the support from cornerstone investors as a sign of confidence in the group’s hybrid model and global footprint.

The French government reaffirmed its strategic alignment, emphasizing the national and continental importance of secure satellite infrastructure. Economy Minister Eric Lombard noted that the transaction reflects “France’s commitment to building a resilient and sovereign space industry” through technological innovation and investment partnership.

As Europe intensifies its focus on autonomous defense and digital communications, Eutelsat appears well-positioned to act as a foundational infrastructure provider for the continent’s space ecosystem.