Eutelsat’s Debt Outlook Shifts as Asset Sale Collapses

Eutelsat FR0010221234

The French satellite operator Eutelsat has revised its financial forecasts following the unexpected failure of a significant asset disposal plan. A deal to sell its passive ground infrastructure to the private equity firm EQT Infrastructure VI has been terminated after certain closing conditions were not satisfied. This development removes an anticipated cash injection and alters the company's debt trajectory, even as it proceeds with a multi-billion euro satellite investment program.

The collapsed transaction was expected to generate net proceeds of approximately 550 million euros for Eutelsat. Consequently, the company now anticipates a higher leverage ratio. The net debt to EBITDA multiple is projected to reach around 2.7x by the close of fiscal year 2025-26, an increase from the previous forecast of 2.5x.

However, management highlighted a mitigating factor: the sale would have come with an attached service agreement, costing the company between 75 and 80 million euros annually in adjusted EBITDA. The deal's failure, therefore, impacts both expected cash flow and future earnings structure.

Looking further ahead, Eutelsat has upgraded its long-term profitability guidance. For FY 2028-29, the company now expects an EBITDA margin of roughly 65%, compared to a prior outlook of about 60%. Leadership has also stressed that the financing capacity for its planned capital expenditures remains intact despite the sale's collapse.

Massive Satellite Constellation Investment Proceeds

Parallel to these financial adjustments, Eutelsat is advancing a major fleet renewal initiative for its OneWeb constellation. In mid-January, the company placed a substantial order with Airbus Defence and Space for 340 new satellites. This follows a previous order for 100 satellites placed in December 2024, bringing the total program to 440 satellites.

The total projected cost for this entire satellite batch remains about 2.2 billion euros. Production will occur on a newly installed assembly line at the Airbus facility in Toulouse, with the first deliveries scheduled to commence by the end of 2026.

The new generation of satellites will feature several technical enhancements, including:
* Advanced digital payloads
* Upgraded onboard processing capabilities
* An optimized architecture designed for long-term performance
* Capacity to host third-party payloads

The urgency for this refresh is driven by the lifecycle of the existing fleet. The first-generation satellites, launched between 2020 and 2023, are expected to reach the end of their operational life in 2027 and 2028.

Funding Strategy and Broader Capital Commitments

Prior to confirming the large satellite order, Eutelsat had taken steps to bolster its equity base. In November 2025, the company secured 828 million euros from major shareholders, including the French and British governments, Bharti, CMA CGM, and FSP. This was followed by a further capital increase raising 670 million euros in December 2025.

The broader financial picture at the turn of the year is now defined by contrasting elements. The expected infusion from the infrastructure sale is absent, leading to a higher projected debt level. Simultaneously, preparations for the fleet renewal cycle, costing around 2.2 billion euros, are underway for a late 2026 start. According to the source text, Eutelsat also plans investments of approximately 2 billion euros into the European IRIS² constellation, with its deployment slated to begin towards the end of the decade.

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