Europe's three major aerospace corporations are preparing to integrate their satellite businesses. The move is aimed at countering Starlink, the satellite internet service of Elon Musk's space corporation SpaceX.
The French daily Le Monde reported on the 15th (local time) that Europe's largest aerospace corporation, Airbus, a French-German-Spanish joint venture, along with France's Thales and Italy's Leonardo, are preparing to integrate their satellite businesses.
Thales and Leonardo have already been cooperating in space since 2007 through Thales Alenia Space (satellite manufacturing) and Telespazio (satellite communications services). Reuters reported that if Airbus joins, the corporations' total revenue would exceed 6 billion euros (about 9.7 trillion won) and their valuation would reach 10 billion euros (about 16 trillion won).
The integration of the three corporations' satellite businesses is seen as a response to the rapid domination of the global low-Earth orbit (about 800 kilometers from Earth) satellite communications market by the U.S.-based Starlink. Until now, European satellite manufacturers have custom-built large geostationary orbit (36,000 kilometers from Earth) satellites for telecom and broadcasting operators such as France's Eutelsat and Luxembourg's SES.
Industry watchers expect the satellite business merger to be finalized within this year. Michael Schoellhorn, Airbus's head of defense and space, said in an interview with Italy's Corriere della Sera, "Such a process requires two steps: a signature pledging to join forces and the practical completion of the agreement," adding, "The signature could happen within this year."
Le Monde noted that while all three corporations acknowledge the need for a merger, many obstacles remain. There could be conflicts over equity ratios and management control among the corporations. Le Monde also projected that, as seen in the past with Airbus, the nationality of executives could trigger serious political tensions among European countries.
For the three corporations to merge their satellite businesses, they must also obtain approval from European antitrust authorities. On this, Airbus Chief Executive Officer (CEO) Guillaume Faury said in February, "We hope European antitrust authorities will review this in a way different from before," urging them to focus more on global competition than on competition within Europe.