Amazon to Buy Globalstar in $11.6B Deal for Satellite Licenses
Amazon will acquire Globalstar for $11.6 billion, offering shareholders $90 per share cash or 0.32 Amazon shares, representing a 117% premium over October’s trading levels. The deal, Amazon’s second-largest acquisition, secures key RF licenses to launch a direct-to-device service in 2028 and is set to close in 2027.
1. Deal Overview
Amazon will acquire Globalstar for $11.6 billion, paying shareholders $90 per share cash or 0.32 Amazon shares capped at $90 value. This transaction marks Amazon’s second-largest acquisition and is scheduled to close in 2027.
2. Strategic Rationale
The purchase secures radio frequency licenses essential for Amazon’s planned direct-to-device connectivity service launching in 2028. These licenses enable customers to receive satellite broadband directly on mobile devices without relying on traditional cell towers.
3. Financial Terms and Shareholder Options
Globalstar shareholders may elect cash or stock compensation, with cash payments capped at 40% of the total consideration. The 117% premium over pre-offer prices underscores Amazon’s valuation of Globalstar’s spectrum and infrastructure assets.
4. Competitive Dynamics
The acquisition intensifies competition with SpaceX’s Starlink, which operates over 10,000 satellites serving 10 million users. Amazon also plans to transition Apple’s emergency messaging onto its Leo network, further boosting its satellite service ecosystem.