LeoSat restructures financing
September 30, 2019
By Chris Forrester
LeoSat is planning to girdle the planet with between 78-108 satellites, each equipped with laser-based connectivity for ultra-fast low-latency communications. But raising sufficient cash has proved to be a major challenge.
LeoSat has Mark Rigolle as its CEO, and Rigolle has past expertise as CEO at SES-backed O3b and prior to that position he as CFO at SES itself. He has been at LeoSat since 2015.
The would-be satellite operator has been working with Thales Alenia Space on the design of the satellites and their orbital constellation.
Its investors to date include Hispasat of Spain and Japan’s SkyPerfect JSAT, and the initial budget for the constellation was to be some $3.5 billion.
It is understood that neither Hispasat or SkyPerfect wish to expand their existing investments, and industry reports say that Rigolle is trimming those budget demands to nearer $3 billion.
Unfortunately, LeoSat has only until January 2021 to “bring into use” frequencies allocated to it by the International Telecommunications Union (ITU). ITU rules state that if frequencies are not activated then their company’s rights to those frequencies lapse.
LeoSat wanted to speedily-built satellites to be launched to secure those frequencies, but reportedly is now looking to scale back its ideal plans including smaller – and less expensive – satellites that would also be cheaper to launch into orbit.
Rigolle says that LeoSat has firm Letters of Intent worth $2 billion in long–term contracts to utilise its service.