France Blocks Eutelsat's Antenna Sale, Citing Sovereignty and Security Against Starlink Rivalry

By Gianluca Lo Nostro and Louise Rasmussen

PARIS, Jan 30 (Reuters) — In a move underscoring Europe's tightening grip on strategic infrastructure, France has formally blocked the sale of satellite operator Eutelsat's ground antenna division. Finance Minister Roland Lescure confirmed the veto on Friday, framing the decision as a necessary defense of national sovereignty and security.

"These are not just commercial assets; they are the nervous system of our satellite communications, serving both civilian and military needs," Lescure stated in a televised interview with TF1. "As Starlink's primary European challenger, Eutelsat represents a strategic interest we must protect."

The decision halts a deal, first announced in 2024, that would have seen Eutelsat's passive ground infrastructure sold to Swedish private equity firm EQT for an estimated net proceeds of 550 million euros ($656 million). The French state, which holds a 29.6% stake as the largest shareholder in the Paris-headquartered company, exercised its influence following a review. Eutelsat's shares dipped 5% on the news in early trading.

While the company acknowledged the transaction would not proceed, a spokesperson declined to comment directly on the minister's intervention. Eutelsat noted, however, that retaining the assets would improve its profit margins by roughly 5% over the next three years by eliminating leasing costs.

In a subsequent post on the social media platform Bluesky, Lescure emphasized that the veto was "solely linked to the critical nature of this activity for French sovereignty" and not a reflection on the quality of the prospective investor.

Analysis: The intervention highlights the escalating geopolitical tensions surrounding space and communications infrastructure. Ground antennas, which link satellites to terrestrial networks, are increasingly viewed as dual-use critical infrastructure. Eutelsat's role was cemented last year with a 1-billion-euro, 10-year contract to provide services to the French military, making its network integral to national defense.

This is not an isolated case of French economic interventionism. Lescure concurrently confirmed the government's oversight in the sale of defense supplier LMB Aerospace to U.S.-based Loar Holdings. While allowing that sale, the state will retain a "golden share" to ensure production remains in France's Correze region, after attempts to find a European buyer proved futile.

Reactions & Commentary:

Marie Thérèse Dubois, Space Policy Analyst at Institut Montaigne: "This is a pragmatic, if unsurprising, decision. In the current landscape, letting core connectivity infrastructure fall outside national oversight is a risk no major power will take. It's about maintaining strategic autonomy."

Klaus Berger, Telecoms Consultant in Berlin: "The financial logic for the sale was sound for Eutelsat's balance sheet. But the state's calculus is different. They are weighing 550 million euros against long-term dependency and security. The latter won."

Jean-Luc Lefevre, Former Engineer, French Space Command: "Finally, a clear signal! For years, we've been naively selling our crown jewels. Starlink's dominance is a wake-up call. This isn't protectionism; it's the bare minimum of defense planning. We must control the physical links to our satellites."

Sophie Chen, Portfolio Manager, Global Tech Fund: "This creates uncertainty for investors in European tech. Where is the line between a strategic asset and a commercial one? The government's substantial stake in Eutelsat always meant this was a possibility, but it will give pause to others considering investments in similar sectors."

($1 = 0.8380 euros)

(Reporting by Inti Landauro and Louise Rasmussen in Paris, Gianluca Lo Nostro in Gdansk; Editing by Matt Scuffham)