Eutelsat's statement came after two sources close to the negotiations told Reuters at the weekend it was poised to buy OneWeb, which was valued at $3.4 billion in its most recent funding round and in which Eutelsat already has a 23% stake.
"Investors don’t appreciate the uncertainty, and if ETL is in a merger of equals with OneWeb, then ETL investors get a share in a new entity where the other half is pretty much an unknown to them ... So I understand why ETL shares are down on the news," said one trader in London. "From an anti-trust point of view, this deal is likely to be scrutinised heavily and will also likely need political consensus from both the UK and EU at a time when the UK is choosing a new Prime Minister," Credit Suisse said in a note.Demand for satellite launches is expected to accelerate after recent sanctions have sidelined the Russian space launch industry, and giant satellite constellations could offer a new channel to beam broadband Internet from space.