OneWeb files for bankruptcy protection
March 30, 2020
By Chris Forrester
OneWeb filed for Chapter 11 bankruptcy protection in the US Bankruptcy Court for the Southern District of New York on March 27th. There is a preliminary hearing into their bankruptcy on March 31st.
A OneWeb statement said: “The Company intends to use these proceedings to pursue a sale of its business in order to maximize the value of the company. Since the beginning of the year, OneWeb had been engaged in advanced negotiations regarding investment that would fully fund the Company through its deployment and commercial launch. While the Company was close to obtaining financing, the process did not progress because of the financial impact and market turbulence related to the spread of Covid-19.”
“Today,” the statement continued, “the Company has filed a number of customary motions with the US Bankruptcy Court seeking authorisation to support its ongoing operations during the Chapter 11 process, including approval for the consensual use of its existing cash collateral to continue to fund the business. In addition, OneWeb is actively negotiating debtor-in-possession financing, which, if acquired and approved by the Bankruptcy Court, will ensure OneWeb is able to fund additional financial commitments as it conducts a sale process under Section 363 of the US Bankruptcy Code. Together, these actions will allow OneWeb to meet post-petition obligations to its remaining employees and certain vendors in the ordinary course.”
Adrian Steckel, CEO at OneWeb, stated: “OneWeb has been building a truly global communications network to provide high-speed low latency broadband everywhere. Our current situation is a consequence of the economic impact of the Covid-19 crisis. We remain convinced of the social and economic value of our mission to connect everyone everywhere. Today is a difficult day for us at OneWeb. So many people have dedicated so much energy, effort, and passion to this company and our mission. Our hope is that this process will allow us to carve a path forward that leads to the completion of our mission, building on the years of effort and the billions of invested capital. It is with a very heavy heart that we have been forced to reduce our workforce and enter the Chapter 11 process while the Company’s remaining employees are focused on responsibly managing our nascent constellation and working with the Court and investors.”
It is not yet clear how the Chapter 11 will affect OneWeb’s London-based parent company (OneWeb Communications Ltd) or its Jersey (Channel Islands) business OneWeb Ltd and WorldVu Satellites Ltd., other than all its subsidiary companies are included in the bankruptcy.
Its latest Consolidated Financial Statements were filed in London on October 10th last year (for the year to December 31st 2018. The financials show that OneWeb had secured about $3.3 billion in equity and debt financing. KPMG are the company’s auditors.
There are numerous formal Financial Charges listed against the company, notably with SoftBank Group Corp on March 18th 2019 which granted SoftBank a Charge over the entire issued share capital of the company (both ordinary and preferred shares).