Leading global law firm Herbert Smith Freehills has advised Bharti Global Limited, a member of the consortium with the UK Government (through the Secretary of State for Business, Energy and Industrial Strategy), on the entry by the consortium into agreement for the acquisition of the OneWeb business in connection with its court-supervised sale process.
The consortium has committed to provide USD $1 billion to acquire OneWeb and fund the full restart of its business operations.
Following a competitive process, the consortium’s winning bid will enable OneWeb to successfully emerge from the Chapter 11 process with a robust foundation on which to continue its progress towards commercial operations and secure OneWeb’s position as a global leader in low latency connectivity.
Bharti, through Bharti Airtel, is the third largest mobile operator in the world, with over 425 million customers. Bharti Airtel has its own extensive mobile broadband networks and enterprise business, which will act as the testing ground for all OneWeb products, services, and applications. Bharti will contribute significant contract value to OneWeb through its presence across South Asia and Sub-Saharan Africa, where the terrain necessitates the use of satellite-based connectivity, providing a near-term anchor customer for large-scale global deployment of OneWeb’s services.
The transaction signals the government’s ambition for the UK to be a pioneer in the research, development, manufacturing, and exploitation of novel satellite technologies through the ownership of a fleet of Low Earth orbit satellites.
OneWeb implements a constellation of Low Earth Orbit satellites with a network of global gateway stations and a range of user terminals to provide an affordable, fast, high-bandwidth and low-latency communications, connected to the IoT future and a pathway to 5G for everyone, everywhere.
The transaction remains subject to approval by the U.S. Bankruptcy Court, as well as regulatory approvals and customary closing conditions. The transaction is expected to close by the fourth quarter of 2020.
Herbert Smith Freehills was lead counsel for Bharti on the deal, supported by Cravath, Swaine & Moore LLP on US matters. The Herbert Smith Freehills team was led by Bharti relationship partner Alan Montgomery and Head of Global M&A practice Gavin Davies, with support from Siddhartha Shukla. Specialist advice was provided by partners Aaron White and David Coulling (TMT), Kevin Pullen and Stephen Conyers (Restructuring, Turnaround and Insolvency), Veronica Roberts (competition), Isaac Zailer (tax) and Joe Falcone (US regulatory). Other members included associates Lucy Gemmell and Savy Jajmann. Paul Zumbro and Damien Zoubek led the Cravath team.
Alan Montgomery commented: “It has been phenomenal to work with our long-standing client Bharti on this landmark transaction. This was a high-strategy, complex deal executed at an incredible pace. We have worked closely with the Bharti team on many deals over the years, and this important acquisition is no exception. The deal is testament to our strength in advising clients on their strategic investments across different practices, and also our deep expertise in the TMT sector.”
Gavin Davies added: “We are delighted our clients are able to continue to execute significant and complex M&A in these disrupted times, in this case through a cross border sale, in a US court supervised bankruptcy process, with the UK Government in consortium with our client.”