Amazon completes $11.57 billion acquisition of Globalstar

Amazon has closed its acquisition of Globalstar, a satellite telecommunications company, in a $11.57 billion transaction announced Tuesday. The deal strengthens Amazon's push to develop its own satellite network and compete with Starlink, the space communications business of SpaceX owned by Elon Musk.

The acquisition ranks as the second-largest in Amazon's history, behind the 2017 purchase of Whole Foods Market for $13.7 billion and ahead of the 2021 acquisition of MGM Studios for $8.5 billion.

Globalstar shareholders have the option to receive $90 per share under the agreement terms. Globalstar's stock surged approximately 10 percent in early trading following the announcement, exceeding $80 per share and lifting the company's market capitalization to around $10.3 billion. Amazon's stock rose more than 2 percent.

Through the transaction, Amazon adds Globalstar's approximately two dozen satellites to its existing network of more than 200 satellites. The company is working to deploy roughly 3,200 satellites in Earth's low orbit by 2029, with approximately half required to be operational by a July regulatory deadline. Amazon plans to roll out its satellite internet services later this year.

Tech companies are investing billions of dollars to capture the growing market for satellite-based connectivity. Starlink currently operates a network of approximately 10,000 units, presenting a significant challenge for Amazon's Project Kuiper initiative. The satellite internet sector has become increasingly competitive as multiple companies seek to establish global broadband coverage through orbital networks.