Prime Highlights :
- SES and Eutelsat set to receive nearly $6.1 billion in combined incentive payments for clearing US satellite spectrum, lifting their shares sharply.
- Federal Communications Commission allocates $6.3 billion among satellite operators to free 160 megahertz of upper C-band spectrum for US mobile networks.
Key Facts :
- SES secures 89 per cent of the FCC’s $6.3 billion incentive pool.
- Operators must finish the main spectrum transition by December 2030.
Background :
European satellite operators SES and Eutelsat stand to receive close to $6.1 billion in combined payments for helping free up satellite spectrum for next-generation wireless services in the United States, the companies announced, sending their shares sharply higher.
SES climbed 6.6 per cent while Eutelsat rose 5.7 per cent in early trading, as investors welcomed the scale of the incentive payments tied to the spectrum clearance.
The Federal Communications Commission has allocated $6.3 billion in incentive payments among satellite operators, with SES receiving 89 per cent, Eutelsat taking 8 per cent, and Canada’s Telesat set to receive 3 per cent.
The FCC aims to free up 160 megahertz of upper C-band spectrum for mobile operators, with an auction scheduled for April 2027.
Satellite companies must complete the main spectrum transition by December 2030 to receive $4.9 billion of the incentives, with a further $1.4 billion tied to a final deadline in June 2031. Operators will also be reimbursed for eligible transition costs, which the FCC estimates between $4 billion and $5 billion.
JPMorgan analysts placed the net present value of the payments at around €6 per SES share, compared with less than €0.5 per Eutelsat share, and noted that SES’s gross $5.6 billion payment could see deductions tied to Intelsat bondholders, who hold rights to 42.5 per cent of proceeds from the first 100 megahertz of cleared spectrum.
The deal also signals the scale of spectrum spending ahead for US operators, with the 2027-2028 auctions projected to require around $25 billion.