European satellite firm Eutelsat has cancelled the sale of its passive ground segment infrastructure to EQT Infrastructure VI following an intervention by the French government.

The French operator said the transaction would not proceed as all conditions “have not been satisfied.”

Speaking on TV Bonjour! La Matinale TF1, Roland Lescure, France’s minister of the Economy, Finance, and Industrial, Energy, and Digital Sovereignty, said he had decided not to authorize the sale of Eutelsat’s ground station infrastructure.

Lescure explained that the antennas are considered “strategic infrastructure” for military and civilian communications, and that the decision was made for French sovereignty.

First announced in December 2024, net proceeds from the transaction would have been around €550 million ($655 million).

Eutelsat’s ground station business consists of approximately 1,400 antennas across more than 100 locations globally, enabling satellite communications for Eutelsat Group, OneWeb, and other third-party customers.

The French government is the largest shareholder in Eutelsat, with a near 30 percent stake in the company. It increased its investments in Eutelsat in June last year as part of a $1.5 billion funding round to fuel the satellite company’s low-Earth orbit ambitions.

The negative annualized impact on adjusted EBITDA associated with the agreement amounted to $89-95 million.

Eutelsat said the cancellation of the transaction has “no impact on financial objectives for FY 2025-2026, with the exception of net debt to EBITDA which is now expected to stand at 2.7 times at the end of the financial year (versus 2.5 times previously).”

“The EBITDA margin for FY 2028-2029 is now expected in the region of 65 percent (versus c.60 percent previously,” the company said, “the cancellation does not affect its ability to fund the capital expenditure related to its strategic growth trajectory.”