Amazon buys Globalstar for $11.6B to rival Musk's Starlink
What's the story
Amazon has announced its plan to acquire satellite company Globalstar in a deal worth $11.57 billion. The acquisition will significantly boost Amazon's space business and help it take on Elon Musk's Starlink, which currently has a network of about 10,000 satellites in orbit. The deal will give Amazon access to Globalstar's network of two dozen satellites, enhancing its capabilities in the field of satellite-based connectivity services.
Growth strategy
Amazon's satellite internet service
Amazon has been actively working to expand its satellite network, with a target of deploying some 3,200 satellites in low Earth orbit by 2029. The company currently operates a network of over 200 satellites and plans to launch its satellite internet services later this year. The acquisition of Globalstar will further accelerate these efforts and help Amazon meet its ambitious deployment targets.
Service expansion
Globalstar's existing partnerships and services
Globalstar, which operates about two dozen satellites in low-Earth orbit, is known for powering Apple's "emergency SOS" feature. The company provides voice, data, and asset-tracking services to enterprise, government and consumer customers. Amazon has signed a deal with Apple to continue providing these satellite-based safety features for iPhone and Apple Watch users after the acquisition of Globalstar is completed.
Acquisition details
Deal subject to regulatory approvals
Under the terms of the deal, Globalstar shareholders can choose between $90 in cash or 0.3210 shares of Amazon common stock for each share they own. The acquisition is subject to regulatory approvals and Globalstar meeting certain satellite deployment milestones. It will also require approval from the US Federal Communications Commission (FCC), whose chair Brendan Carr said the FCC was "very open-minded" to the acquisition during an interview on CNBC.