Rocket Lab in $8B Iridium acquisition

IMAGE: Rocket Lab/Iridium

McLean, Va.-based LEO satcom pioneer Iridium Communications Inc. (Nasdaq: IRDM) is to be acquired byLong Beach, Calif.-based launch and space systems specialist Rocket Lab Corporation (Nasdaq: RKLB).

The deal will see Rocket Labs acquire all the outstanding shares of Iridium common stock for $54 per share in a cash and stock transaction that represents an enterprise value for Iridium of approximately $8.0 billion.

The companies say that the acquisition merges Rocket Lab’s launch capabilities and satellite manufacturing with Iridium’s global satellite communications network, spectrum, and 500-plus strong partner ecosystem to create a competitive, vertically-integrated space company that designs, builds, launches, and operates its own constellations, delivering critical communications capability to millions of users worldwide.

The transaction will give Rocket Lab an immediate foothold in space-based applications, including both proprietary and standards-based satellite Internet of Things (IoT) and direct-to-device (D2D), positioning, navigation and timing (PNT), and critical safety-of-life services. Rather than simply continuing the Iridium network, Rocket Lab will build upon it to scale into untapped markets and introduce new space-based services,

Iridium’s L-band spectrum and low Earth orbit (LEO) satellite network provide a foundation for reliable satellite communications and PNT services across government, defense, aviation, maritime, and commercial markets. Supporting more than 2.55 million active subscribers worldwide, Iridium delivers reliable, weather-resilient connectivity and an alternative PNT architecture for applications where Global Positioning Systema (GPS) and other Global Navigation Satellite Systema (GNSS) are degraded or unavailable.

Combining Rocket Lab’s launch, spacecraft manufacturing, and space systems expertise with Iridium’s global network and L-band spectrum will accelerate innovation, positioning the combined company to support the development and deployment of Iridium’s next-generation constellation. This includes direct-to-device (D2D/Iridium NTN DirectSM) services, which will grow into an important new capability for U.S. national security and emergency response, helping to ensure reliable, resilient communications when and where they are needed most, particularly where traditional networks are unavailable or compromised.

“This is a defining moment for the space industry and the start of a new era of strategic, accelerated growth for Rocket Lab and Iridium,” said Sir Peter Beck, founder and CEO of Rocket Lab. “Iridium has built the gold standard in secure, safety critical global satellite connectivity. It is relied upon by maritime fleets, the aviation industry, governments, and heavy industrial organizations who operate in the most remote off-the-grid locations. By marrying Iridium’s deep heritage, trusted infrastructure, and highly sought-after spectrum with Rocket Lab’s extensive and proven launch and manufacturing capabilities, we have the capability to unlock entirely new markets. We will go far beyond maintaining a legacy; we are going to build upon it to pioneer next-generation space applications and deliver sought-after capabilities to existing and new customers.”

“As the worlds of space and terrestrial communications continue to converge, more critical services will depend on space-based capabilities,” said Matt Desch, CEO, Iridium. “Success will come from those who can bring new innovations to space quickly and sustain them over time as efficiently as possible. We’re excited about being able to accelerate the next generation of IoT, aviation, maritime, PNT, and national security capabilities, and pursue new innovative applications as part of Rocket Lab – a fully integrated, end-to-end space company. That’s an incredible opportunity for our customers, partners, employees, and stockholders.”