Amazon to buy Globalstar

Amazon agreed on April 14 to buy satellite operator Globalstar for about $11.6 billion, adding an existing space network to its own internet push. (aboutamazon.com) The deal values Globalstar at $90 a share, payable in cash or Amazon stock, and Globalstar said the total consideration is about $11.57 billion. The companies said the transaction is expected to close in the second half of 2027, pending shareholder and regulatory approval. (investors.globalstar.com) Amazon said Globalstar’s satellites, spectrum licenses and operations team will be folded into Amazon Leo, the company’s low Earth orbit network. Low Earth orbit satellites fly closer to Earth than traditional communications satellites, which cuts delay and makes phone links more practical. (aboutamazon.com) The immediate target is direct-to-device service, which lets an ordinary phone connect to a satellite when a cell tower is out of range. Amazon said the combined system is meant to help mobile carriers extend voice, text and data coverage beyond terrestrial cellular networks. (aboutamazon.com) That gives Amazon something it did not have at scale: a working mobile-satellite platform and licensed radio spectrum already used for handset features. CNBC reported the acquisition would strengthen Amazon’s effort to compete with SpaceX’s Starlink in satellite internet. (cnbc.com) Globalstar is best known to many consumers because its network supports satellite features on recent Apple devices. Amazon said it also signed an agreement with Apple for Amazon Leo to power satellite services on supported iPhone and Apple Watch models, including emergency texting, roadside assistance and messaging. (aboutamazon.com) The New York Times reported Amazon had been looking for a faster route into phone-to-satellite service as rivals moved ahead with consumer offerings. Buying Globalstar gives Amazon both spacecraft already in orbit and access to airwaves that are difficult to secure from scratch. (nytimes.com) Globalstar shareholders can elect cash or stock, but the stock portion is capped at a value equivalent to $90 a share, and cash elections are capped at 40% of shares before proration. Globalstar also said the aggregate consideration can be reduced by as much as $110 million if certain operational milestones are missed. (investors.globalstar.com) Reuters reported the agreement lands as technology companies keep spending heavily on satellite connectivity, a market led by Starlink’s much larger constellation. Amazon is using the purchase to skip years of building around one of the hardest parts of the business: spectrum rights and mobile partnerships. (usnews.com) If regulators and shareholders approve the merger, Amazon will move from launching its own satellites to owning a network that already reaches phones. The bet is that the next satellite race will be decided not only by home internet dishes, but by who can turn a normal smartphone into an off-grid communicator. (aboutamazon.com)