LONG BEACH, Calif., June 29 — Rocket Lab is buying Iridium Communications in an $8 billion cash-and-stock deal, merging a rocket builder with a satellite telecom giant. The move comes just two weeks after competitor SpaceX completed its record-setting IPO.
The proposed acquisition would link Rocket Lab’s launch and satellite manufacturing business with Iridium’s existing global satellite network. That network, which uses L-band spectrum and low-Earth-orbit satellites, currently serves more than 2.55 million subscribers. Its customers include governments, defense agencies, aviation and maritime operators, and commercial clients.
Here’s what it means in plain terms: Rocket Lab has been a company that builds rockets and satellites. Iridium is a company that runs a satellite phone and data network — think of it like a cell tower in space, but one that works in the middle of the ocean or the Arctic. By buying Iridium, Rocket Lab becomes a one-stop shop: it can build the satellites, launch them on its own rockets, and run the communications network they power.
Rocket Lab will pay Iridium shareholders $27 in cash per share, plus Rocket Lab stock, bringing the combined value to $54 per Iridium share. That’s a 24.1% premium over Iridium’s closing price on June 26. The practical upshot for Iridium investors: a nice payday, and a stake in the combined company going forward.
This is Rocket Lab’s first acquisition of a publicly traded company. It has made smaller purchases before, but this is a leap in scale.
“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, Rocket Lab’s CEO, in a statement. He called Iridium’s network “the gold standard in secure, safety-critical global satellite connectivity,” noting it is relied upon by maritime fleets, aviation, governments, and heavy industrial organizations in remote locations.
The deal still needs regulatory approval. If it goes through, Rocket Lab will control both the infrastructure to get to space and the network that operates once you’re there. That’s a combination no other private space company has pulled off at this scale.
