British Satellite Broadband Operator Avanti Slashes Debt

Avanti, which is based in the UK and runs the HYLAS network of five large Ka-band communication satellites in high earth orbit (35,792km) for rural broadband and backhaul delivery across Europe, the Middle East and Africa (EMEA), has been given a reprieve by a new investment deal that slashes its debt from $810m to $260m (£198m).

Over the past few years’ most of the talk around satellite broadband connectivity has largely shifted to focus on the new generation of mega constellations in Low Earth Orbit (e.g. Starlink, OneWeb, Amazon), which tend to offer significantly faster latency times and data speeds.

Suffice to say, the more traditional operators of large communication satellites in significantly higher geosynchronous and geostationary orbits have come under greater competitive pressure. But nothing in the space sector is cheap to do and some of those operators, like Avanti, have been struggling to manage a growing mountain of debt.

The good news is that Avanti has found a way to turn hedge funds into significant shareholders to help reduce their debt and free up flexibility for future development. Funds (or subsidiaries of such funds) and/or accounts managed, advised or controlled by HPS Investment Partners LLC or affiliates/subsidiaries thereof, and Solus Alternative Asset Management LP, will now become the principal shareholders.

Kyle Whitehill, Avanti CEO, said:

“Today’s completion of our planned financial recapitalisation marks a major milestone in Avanti’s transformation as a business. Achieving this significant reduction in our legacy debt burden leaves us in a strong position to continue the growth of our business and to deliver our mission of connecting the unconnected across Europe, the Middle East & Africa through our HYLAS fleet of Ka-band satellites.”

Avanti said it would be “business as usual“, albeit with a stronger balance sheet. There will be no change to the Avanti team or Avanti’s business activities, assets, and technical capabilities as a result of this deal.