Amazon and Globalstar have finalized a merger agreement in which Amazon will acquire the satellite communications company for $11.57 billion. A separate deal ensures that Amazon's Leo satellite network will continue to provide satellite services for current iPhone and Apple Watch users, supporting features like Emergency SOS, Messages via Satellite, Find My, and Roadside Assistance.
These services are currently powered by Globalstar for iPhone 14 and newer models, as well as the Apple Watch Ultra 3. Regulatory approvals are still required before the deal can be completed, with both companies expecting this to happen sometime in 2027. The transaction has already received written consent from Globalstar shareholders holding about 58% of the voting power.
Deal Structure and Amazon’s Key Gains
Globalstar shareholders have the option to receive either $90 in cash per share or 0.3210 shares of Amazon stock, based on an equivalent value. Cash payments are limited to 40 percent of the total outstanding shares, and any election for cash exceeding that limit will automatically be converted to stock. The overall deal value could be reduced by up to $110 million if Globalstar does not meet certain operational milestones before the closing.
The acquisition gives Amazon control over Globalstar's satellite operations, ground infrastructure, and mobile satellite service licenses authorized in more than 120 countries. Globalstar's existing satellites, along with new ones under construction by MDA Space, will be combined into a single Leo network.
Apple’s Stake in Globalstar and Its Ongoing Role
Apple invested $1.5 billion in Globalstar in 2024, taking about a 20% stake and securing priority access to 85% of the network's capacity. The service agreement made alongside the investment addresses any complications from Apple's stake, ensuring satellite features continue to work for iPhone and Apple Watch users under Amazon Leo's management.
Greg Joswiak, Apple's senior vice president of worldwide product marketing, stated that the deal guarantees users will still have access to satellite features that support safety and connectivity when off the grid.
Amazon Leo’s Long-Term Satellite Ambitions
Amazon Leo currently operates around 180 to 200 satellites, well short of its planned full constellation. The company has asked the FCC for more time to reach a milestone that would have required about 1,600 satellites in orbit by July 2026. Meanwhile, Globalstar's constellation includes more than 24 low Earth orbit satellites, with contracts signed for over 50 additional satellites.
Amazon Leo plans to launch a satellite system in 2028 that can deliver voice, data, and messaging directly to mobile phones and other devices. Once complete, the constellation is expected to include thousands of satellites and serve hundreds of millions of users worldwide.
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