Amazon to Acquire Globalstar in $11.57 Billion Deal to Boost Satellite Ambitions

Tech companies have been investing heavily to capture the growing market for satellite-based connectivity, though matching Starlink’s roughly 10,000 satellites remains a significant challenge. According to Reuters, the acquisition would add Globalstar’s roughly two dozen satellites to Amazon’s existing constellation of more than 200, as the company works toward deploying about 3,200 satellites in low-Earth orbit by 2029. Per Reuters, about half of those satellites must be operational by a regulatory deadline in July, and Amazon is preparing to launch its satellite internet services later this year.

Globalstar’s network focuses on low-data, direct-to-device (D2D) connectivity, enabling mobile devices to connect without relying on traditional cellular towers. This capability is particularly important for emergency communications and coverage in remote areas. According to Reuters, the deal will allow Amazon to begin offering D2D services starting in 2028.

Meanwhile, Starlink already serves more than nine million users worldwide. The SpaceX unit has rapidly expanded its satellite constellation and is also working on its own D2D services through partnerships with telecom providers such as T-Mobile. Per Reuters, the scale and speed of Starlink’s deployment have made it the dominant player in the satellite broadband market.

“Amazon has been falling behind Starlink on satellite broadband. Acquiring Globalstar allows them to catch-up on their D2D spectrum position, and leap ahead on D2D deployment,” said Armand Musey, president and founder of Summit Ridge Group.

Shares of Globalstar rose more than 9% in early trading following the announcement, after gaining over 6% in the previous two weeks amid reports of deal discussions. Amazon’s stock also climbed about 2.5%, according to Reuters.

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Amazon’s move comes as SpaceX advances plans for a potential public listing, with Starlink contributing an estimated 50% to 80% of the company’s revenue. Per Reuters, SpaceX has been launching satellites at a rapid pace, building what is now the largest satellite constellation in the world.

“There has been continued consolidation in the sector in order to compete with SpaceX in the satcom market, given SpaceX’s scale… and virtually unlimited launch capacity. I expect this trend to continue,” said Austin Moeller, director of equity research at Canaccord Genuity.

Under the terms of the deal, Globalstar shareholders can choose to receive either $90 in cash or 0.3210 shares of Amazon stock for each share they own. According to Reuters, this represents a premium of more than 31% compared with Globalstar’s closing price on April 1, before news of the talks surfaced.

The transaction is expected to close next year, pending regulatory approvals and the achievement of certain deployment milestones by Globalstar. The deal will also require approval from the Federal Communications Commission. “We’re very open-minded to the Amazon-Globalstar deal,” FCC Chair Brendan Carr said in an interview on CNBC.

The acquisition also builds on existing partnerships in the satellite space. According to Reuters, Apple, which invested about $1.5 billion in Globalstar in 2024, is working with Amazon to continue supporting satellite-based safety features such as Emergency SOS and Find My for iPhone and Apple Watch users.

Source: Reuters