Key Highlights
- Amazon strikes a $11.6 billion agreement to purchase Globalstar ($GSAT), presenting $90 per share in a mixed cash-and-stock transaction
- The acquisition provides Amazon critical radio frequency spectrum for rolling out direct-to-device satellite connectivity by 2028
- Market reaction: Globalstar shares soared 9.6%; Amazon climbed 3.8%; competitor AST SpaceMobile declined nearly 11%
- Apple’s Emergency SOS satellite capability will migrate to Amazon’s Leo satellite constellation
- This marks Amazon’s second-biggest acquisition to date, anticipated to finalize in 2027 subject to regulatory clearance
Amazon has unveiled plans to acquire satellite communications provider Globalstar through an $11.6 billion transaction designed to compete directly with Elon Musk’s Starlink in the rapidly expanding satellite connectivity sector.
Tuesday’s announcement values Globalstar at $90 per share — representing a premium exceeding 31% above its April 1 closing value and approximately 117% higher than its late-October trading price.
Globalstar investors will have the option to receive either $90 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 shares jumped 9.6% to $79.91. MDA Space, serving as Globalstar’s principal contractor, increased 9%. AST SpaceMobile, a competing player in direct-to-device satellite services, plummeted nearly 11% to $88.57.
The transaction is projected to reach completion in 2027, contingent upon FCC regulatory clearance and achievement of deployment targets.
This represents Amazon’s second-largest corporate acquisition, trailing only its $13.7 billion Whole Foods deal from 2017.
Spectrum Assets Drive Strategic Value
Globalstar currently maintains just a few dozen operational satellites, but the satellite fleet isn’t the primary asset. The critical value lies in spectrum rights — the FCC-authorized radio frequencies essential for delivering connectivity directly to standard smartphones.
“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 maintains approximately 200 satellites in operation. The company aims for over 7,700 satellites ultimately, 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 directly through satellites, bypassing traditional cellular infrastructure.
By comparison, Starlink has already deployed 10,000 satellites providing service to approximately 10 million subscribers worldwide. The company has been advancing its own direct-to-device technology through collaboration with T-Mobile.
Apple’s Emergency Service Transitioning to Amazon Leo
A significant component of this transaction: Apple’s Emergency SOS satellite functionality, presently enabled by Globalstar on iPhone and Apple Watch devices, will shift to Amazon Leo infrastructure.
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 this stake following the acquisition.
Amazon has additionally secured Delta Air Lines as a customer for Leo-powered in-flight Wi-Fi service. Starlink maintains a more extensive airline client base featuring United, Southwest, British Airways, and Emirates.
FCC Chair Brendan Carr stated Tuesday he is “very open-minded” to the deal, describing it as a potential catalyst for competition in an emerging 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 of Summit Ridge Group.
Amazon acknowledged that the transaction value will vary according to its stock price fluctuations until closing. Globalstar equity was assessed at approximately $10.8 billion as of April 9.
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