- The U.K. has pledged to invest $500 million in bankrupt satellite-broadband company OneWeb.
- OneWeb is developing a satellite network that's designed to beam high-speed, low latency internet to Earth.
The U.K. government is set to try and take on Elon Musk's Starlink after it was crowned the winning bidder of failed satellite company OneWeb at an auction in New York.
Like Starlink, OneWeb is aiming to establish a satellite network that can beam high-speed, low latency internet to Earth.
Founded in 2012, OneWeb raised around $3 billion from investors to build its mega-constellation but the firm went bankrupt in March after failing to raise more money from lead investor SoftBank.
At the time of the bankruptcy, OneWeb had launched just 74 of its planned 648 satellites. Starlink, meanwhile, has over 500 in orbit.
The $1 billion-plus rescue bid was made through a consortium involving India's Bharti Global, which through Bharti Airtel, is the third-largest mobile operator in the world, with over 425 million customers.
The new investment provides OneWeb with a second lifeline and it will enable the company to bring back laid-off employees.
U.K. Business Secretary Alok Sharma confirmed the government has pledged to invest $500 million and take a "significant" equity share in OneWeb, which is headquartered in London. The stake is reported to be around 20%.
"The deal underlines the scale of Britain's ambitions on the global stage," said Sharma. "Our access to a global fleet of satellites has the potential to connect millions of people worldwide to broadband, many for the first time, and the deal presents the opportunity to further develop our strong advanced manufacturing base right here in the U.K."
The U.K. has taken stakes in several other high-tech companies to help them through the coronavirus pandemic.
It hopes the OneWeb constellation will provide it with a precise Positioning, Navigation and Timing (PNT) service that could be used in place of the EU's Galileo sat-nav system, which the U.K. is banned from following Brexit.
"We are delighted to have concluded the sale process with such a positive outcome that will benefit not only OneWeb's existing creditors, but also our employees, vendors, commercial partners, and supporters worldwide who believe in the mission and in the promise of global connectivity," said OneWeb CEO Adrian Steckel in a statement.
OneWeb currently builds its satellites in Florida through a partnership with European aerospace juggernaut Airbus.
However, manufacturing will reportedly be moved to the U.K. following the deal.
The U.S. Bankruptcy Court for the Southern District of New York will approve or reject the sale on July 10.