OneWeb is merging with Intelsat, SoftBank to invest another $1.7B in new satellite co.

Yet more consolidation is afoot in the satellite industry. Today, OneWeb — which last December raised a whopping $1.2 billion from SoftBank for its yet-to-launch satellite internet service — announced that it would merge with large satellite incumbent Intelsat. SoftBank separately said it would invest another $1.7 billion in the combined company.

Intellsat was one of the first investors in OneWeb when it was first founded, and the two plan to merge their satellite fleets.

Intelsat has been around since 1964, originally formed as an intergovernmental consortium to build satellite communications systems. But it has been carrying a lot of debt. This deal, the company said, would reduce its debt load by $3.6 billion. Intelsat, which is publicly traded, company today also released its fourth quarter and full-year earnings, which noted $551 million in revenue and $417 million in Adjusted EBITDA.

This is the third big satellite M&A move in the last month. Others have included Google selling its Skybox business to Planet, and DigitalGlobe combining with MacDonald, Dettwiler, and Associates.

“We believe that combining Intelsat with OneWeb will create an industry leader unique in its ability to provide affordable broadband anywhere in the world. As an early equity investor in OneWeb, we recognized a network that was a complement to our next-generation Intelsat EpicN fleet and a fit with our long-term strategy,” said Stephen Spengler, Chief Executive Officer of Intelsat, in a statement. “By merging OneWeb’s LEO satellite constellation and innovative technology with our global scale, terrestrial infrastructure and GEO satellite network, we will create advanced solutions that address the need for ubiquitous broadband. The transaction, including SoftBank’s investment, will significantly strengthen Intelsat’s capital structure and accelerate our ability to unlock new applications, such as connected vehicles, as well as advanced services for our existing customers in the enterprise, wireless infrastructure, mobility, media and government sectors, while also reducing execution and other risks.”

“OneWeb has made incredible technical progress over the past year, and has itself attracted significant investment from SoftBank,” Greg Wyler, Founder and Executive Chairman of OneWeb, said, in a statement. “With SoftBank’s support we will build the world’s first truly global broadband company, accelerating our mission of bridging the digital divide by connecting the four billion people without access today. While there are numerous growth paths available to OneWeb, we are very excited at the prospect of working with Intelsat on this shared objective.”

This is a progression on SoftBank’s bigger strategy to invest big into broadband satellite internet services.

“We are in the midst of a technological revolution and, provided we receive the necessary cooperation from Intelsat bondholders, we welcome the opportunity to support OneWeb as it creates the foundation for next-generation global internet services anywhere on the planet,” he said. “This combination is consistent with SoftBank’s strategy of investing in disruptive, foundational technologies that are building the infrastructure for tomorrow, and this proposal offers a win-win opportunity to accelerate OneWeb’s mission while enhancing the Intelsat balance sheet.”

The companies are holding a press conference now and we’ll update this post with more from that.

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