South Korea’s Hanwha Sells Entire 5.4% Stake in Eutelsat Amid Strategic Refocus
South Korean aerospace and defense company Hanwha Systems announced on Thursday that it is selling its entire 5.4% stake in the Franco-British satellite operator Eutelsat for €77.6 million ($88.5 million). This move comes as Eutelsat seeks new investors to support its second-generation low Earth orbit (LEO) satellite program and commitments to the European Union’s IRIS² project.
Eutelsat has faced significant financial challenges, accumulating hundreds of millions of euros in losses, largely due to its declining video business and delayed returns from its 2023 acquisition of OneWeb. The acquisition has struggled amid stiff competition and slower-than-expected technology deployment.
Hanwha’s sale price of €3.00 per share represented a 13.9% discount to Eutelsat’s previous closing price of €3.48 and reflects a steep loss of approximately 70.5% compared to Hanwha’s initial $300 million investment in OneWeb in 2021. Eutelsat’s shares reacted with a 14.8% drop on the Paris market following the announcement.
Hanwha emphasized that the sale aligns with a strategic pivot to focus more on its core businesses related to defense satellites and military communications, rather than civilian satellite operations. A Hanwha representative also resigned from Eutelsat’s board in April, signaling a reduced involvement.
Eutelsat is currently undergoing leadership changes and financial restructuring, with Jean-François Fallacher recently appointed as CEO. There are also reports that the French government is considering increasing its stake in Eutelsat, potentially doubling it with a capital injection of €1.5 billion to stabilize the company.
Meanwhile, both Starlink and Eutelsat OneWeb recently received licenses from South Korea’s Science Ministry to operate satellite internet services in the country, with service launches expected soon. Hanwha acts as a distributor for OneWeb in South Korea under a 2023 agreement targeting improved LEO communications for government and underserved areas.