March 28 (UPI) -- The London-based global communications company OneWeb, which aims to provide worldwide high-speed Internet connectivity through satellites, has filed Chapter 11 bankruptcy.
The company announced the filing Friday in the U.S. Bankruptcy Court for the Southern District of New York, saying it plans to use the proceedings to maximize the company's value as it pursues its sale.
The filing comes after the company was unable to secure new funding from its largest investor, Softbank, earlier this week, CNN and the Financial Times reported. Some employees will also be laid off as the company restructures.
The company said it's been seeking funding since the beginning of the year, but was unsuccessful because of the disruption in the economy associated with the coronavirus pandemic.
OneWeb CEO Adrian Steckel said this was one reason for the bankruptcy filing.
"Our current situation is a consequence of the economic impact of the COVID-19 crisis," Steckel said in a statement. "We remain convinced of the social and economic value of our mission to connect everyone everywhere."
Steckel added that the bankruptcy process will help the company "carve a path forward," to complete its mission.
The company aims to mass produce 325-pound satellites at its Florida factory near NASA's Kennedy Space Center for a 650-satellite megaconstellation. The goal is to connect everyone around the world, especially under-connected rural areas, to high-speed Internet.
To date, the company has launched 74 satellites as part of its megaconstellation in low Earth orbit. These satellites include 34 launched into orbit on a Russian-built Soyuz rocket from Baikonur Cosmodrome in Kazakhstan last week, a similar 34-satellite launch last month, and the launch of the first six in February 2019.
Prior to the bankruptcy filing announcement, OneWeb had planned to begin Internet service next year.
The company has raised $3.4 billion to date, including $2 billion from Softbank alone, but completing the project could cost up to $7.5 billion, according to outside analysts, SpaceNews reported.
Amazon and Telesat also have plans to increase global connectivity to the Internet through satellites, but haven't begun megaconstellation launches.
SpaceX plans to launch Internet service later this year.