By Andy Pasztor, Alexander Martin and Rolfe Winkler

OneWeb Ltd., which aims to use hundreds of satellites to provide internet access in rural and emerging markets, is raising $1.2 billion in a funding round led by Japan's SoftBank Group Corp. that values the startup at roughly $2.5 billion.

Slated to be announced later Monday, the fundraising ensures that OneWeb, which previously announced a joint manufacturing venture with Airbus Group SE, has the wherewithal to build and launch more than 640 satellites by the beginning of the next decade. The company's goal is to offer fast internet-via-space connectivity to everything from vehicles in urban areas to rural U.S. homes and schools in developing countries.

SoftBank, an early financial backer of some of the largest internet companies on both sides of the Pacific, is pumping $1 billion into the fledgling company to become its largest shareholder, with a roughly 40% stake, said Greg Wyler, OneWeb's founder, executive chairman and chief architect.

The partnership gives Mr. Wyler's team--which also counts British billionaire Richard Branson, Qualcomm Inc. and several other U.S. and foreign companies as backers--momentum to deploy the planned satellites while accelerating work on faster, more capable technology. OneWeb's rivals include billionaire entrepreneur Elon Musk's Space Exploration Technologies Corp, or SpaceX, which similarly wants to provide global internet connectivity.

The step also marks a strategic shift for SoftBank, which hopes OneWeb can createsynergies with the mobile-phone businesses and portfolio of technology companies the Japanese telecommunications and internet conglomerate has assembled over the years. SoftBank is now putting its heft squarely behind a proposed constellation of low-earth orbit satellites unlike any previously launched.

OneWeb is building a highly-automated manufacturing facility in Florida intended to churn out modular satellites faster and cheaper--projected to be under $1 million each--than ever before. The concept is designed to shake up the industry by introducing manufacturing procedures akin to those currently used for medical devices or airplane equipment, replacing time-consuming and customized hands-on satellite assembly practices.

SoftBank said the investment will create roughly 3,000 engineering, manufacturing and support jobs in the U.S.

Write to Andy Pasztor at andy.pasztor@wsj.com, Alexander Martin at alexander.martin@wsj.com andRolfe Winkler at rolfe.winkler@wsj.com

(END) Dow Jones Newswires

December 19, 2016 05:20 ET (10:20 GMT)

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