Amazon to buy Globalstar in $11.5bn deal

(Sharecast News) - Amazon said on Tuesday that it has agreed to buy satellite services operator Globalstar in an $11.5bn deal. Under the terms of the acquisition, Amazon will pay $90.00 in cash per share, or 0.3210 shares of Amazon common stock with a value capped at $90 per share.

The deal will allow Amazon's Leo satelitte business to add direct-to-device (D2D) services to its low Earth orbit satellite network and extend cellular coverage to customers beyond the reach of terrestrial networks. In addition, Amazon and Apple announced an agreement for Amazon Leo to power satellite services for iPhone and Apple Watch, including Emergency SOS via satellite.

The new capabilities are part of Amazon's long-term vision for space-based connectivity, and Amazon said it plans to work with mobile network operators (MNOs) and additional partners to deliver on that vision "and extend reliable, high-speed connectivity to customers, no matter where they are in the world".

Panos Panay, senior vice president of Devices & Services at Amazon, said: "There are billions of customers out there living, traveling, and operating in places beyond the reach of existing networks, and we started Amazon Leo to help bridge that divide.

"By combining Globalstar's proven expertise and strong foundation with Amazon's customer-obsession and innovation, customers can expect faster, more reliable service in more places- keeping them connected to the people and things that matter most. We're excited to support Apple users through the Leo D2D system, and look forward to working with mobile network partners to help extend coverage to every corner of the planet."

At 1400 BST, Globalstar shares were up 9.4% at $79.74 in pre-market trade.