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Bankrupt OneWeb seeks DoD financing to keep assets from Chinese purchase

The March bankruptcy of satellite contractor OneWeb has the Defense Department considering financial help to troubled startup satellite companies to keep their assets out of Chinese hands, a U.S. Space Force official said on Tuesday. File Photo by Paul Brinkmann/UPI
The March bankruptcy of satellite contractor OneWeb has the Defense Department considering financial help to troubled startup satellite companies to keep their assets out of Chinese hands, a U.S. Space Force official said on Tuesday. File Photo by Paul Brinkmann/UPI

May 13 (UPI) -- Bankrupt satellite company OneWeb could get Defense Department funding, a Space Force official said while warning China to stay away from the company's assets.

Startup companies specializing in space research have been hit hard by the coronavirus pandemic. OneWeb, a British company contracted to provide Internet access for the U.S. Space Force in Arctic regions with a consumer-grade, low-earth orbit satellite constellation, declared bankruptcy in March.

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Started in 2015 to great fanfare in the business community, the company raised over $3 billion in startup financing, largely from the Japanese investment firm SoftBank.

The Defense Department is considering action to help OneWeb and other contractors facing insolvency, Lt. Gen. David Thompson, vice commander of Headquarters Space Force, said on Tuesday.

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"I will say with respect to OneWeb specifically and others, we continue to work," Thompson said. "We work with the White House and we'll be working with Congress, not just focused on OneWeb but all of the commercial space companies that face bankruptcy and face those concerns."

He added that the department's Space Acquisition Council collected a list of proposed investments for space companies which need a rapid infusion of capital to ensure that emerging space technologies remain available to the U.S. military. Thompson stressed that an added consideration is the possibility "that potential adversaries don't have the opportunity to acquire those capabilities."

Reports surfaced last week that proposals to buy OneWeb's assets in bankruptcy proceedings were received from two companies with links to the Chinese government. The company has asked the British defense ministry and the U.S. Department of Defense for rescue loans before the final call for bids in June.

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