Key Highlights
- Amazon’s $11.6 billion acquisition of Globalstar ($GSAT) includes a cash-and-stock offer of $90 per share
- The transaction provides Amazon with crucial radio frequency spectrum for direct-to-device satellite connectivity launching in 2028
- Globalstar shares soared 9.6% while Amazon gained 3.8%; competitor AST SpaceMobile declined nearly 11%
- Apple’s Emergency SOS satellite functionality will migrate to Amazon’s Leo satellite constellation
- This marks Amazon’s second-biggest acquisition in company history, with expected closure in 2027 following regulatory clearance
Amazon has entered into an agreement to acquire satellite operator Globalstar for $11.6 billion, marking a strategic move to compete more aggressively with Elon Musk’s Starlink in the expanding satellite communications sector.
Tuesday’s announcement revealed that Globalstar would be valued at $90 per share — representing a premium exceeding 31% compared to its April 1 closing price and approximately 117% above its late-October valuation.
Globalstar investors have the option to receive either $90 in cash per share or 0.3210 shares of Amazon stock. Cash consideration is limited to 40% of the total transaction value.
Amazon stock advanced 3.8% to $249.02 following the announcement. Globalstar jumped 9.6% to $79.91. MDA Space, which serves as Globalstar’s principal contractor, gained 9%. Meanwhile, AST SpaceMobile, a rival in the direct-to-device segment, plummeted nearly 11% to $88.57.
The transaction is anticipated to finalize in 2027, contingent upon FCC regulatory approval and achieving specific deployment targets.
This deal represents Amazon’s second-largest acquisition, trailing only its $13.7 billion purchase of Whole Foods in 2017.
Spectrum Assets Drive Strategic Value
Globalstar maintains only approximately two dozen operational satellites, but that’s largely beside the point. The primary asset is spectrum — FCC-licensed radio frequencies essential for delivering connectivity directly to standard smartphones without modifications.
“Amazon has now repeatedly claimed that their satellite system will offer better service than what’s out there now,” said Caleb Henry of Quilty Space. Amazon CEO Andy Jassy “would not be able to make a claim like that without first acquiring spectrum.”
Amazon’s Leo broadband constellation currently operates approximately 200 satellites in orbit. The company’s ultimate goal includes over 7,700 satellites, with regulatory requirements mandating about 1,600 in orbit by July.
Through the Globalstar acquisition, Amazon intends to introduce a direct-to-device service in 2028 — enabling mobile phone connectivity via satellite without reliance on cellular infrastructure.
By comparison, Starlink has already deployed 10,000 satellites providing service to approximately 10 million subscribers worldwide. The company is advancing its own direct-to-device technology through a collaboration with T-Mobile.
Apple’s Satellite Service Shifting to Amazon Leo
A significant element of the agreement: Apple’s Emergency SOS satellite capability, presently supported by Globalstar on iPhones and Apple Watch devices, will transfer to Amazon Leo.
Apple committed $1.5 billion to Globalstar in 2024 and maintains approximately a 20% ownership position. The company has not yet clarified the future of that stake following the acquisition.
Amazon has additionally secured Delta Air Lines as a customer for Leo’s in-flight Wi-Fi service. Starlink currently serves a more extensive airline portfolio including United, Southwest, British Airways, and Emirates.
FCC Chair Brendan Carr stated Tuesday he is “very open-minded” to the transaction, characterizing it as a potential driver of competition in an emerging marketplace.
“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 of Summit Ridge Group.
The transaction’s final value, Amazon acknowledged, will vary based on its stock price fluctuations until completion. Globalstar’s equity was assessed at approximately $10.8 billion as of April 9.
