• The satellite comms sector is getting hotter
• Space systems specialist Rocket Lab is buying long-time satellite network operator Iridium 
• The move comes in the exhaust plume of Amazon’s Globalstar acquisition and SpaceX’s IPO

Long Beach, California-based Rocket Lab, a major rocket launch services and space manufacturing firm, has announced an $8bn cash and stock deal to acquire McLean, Virginia-based communications satellite constellation Iridium Communications. 

The deal will combine the assets and operations of Rocket Lab with Iridium’s 80 low-earth orbit (LEO) satellites, which provision communications services using L-band spectrum. 

The transaction – which will see Iridium stockholders receive $27.00 in cash and Rocket Lab common stock calculated pursuant to an exchange ratio – comes at a busy time for the satellite industry, following news this year that Amazon is buying Globalstar, as well as SpaceX’s recent mega IPO.

According to Iridium, it has more than 500 partners in its ecosystem and supports more than 2.55 million active subscribers worldwide through services including satellite internet of things (IoT), direct-to-device (D2D), positioning navigation and timing (PNT), and critical safety-of-life services. 

Earlier this year, the company said it had successfully tested its NTN Direct capabilities that enable “two-way message transmission over its low-earth orbit (LEO) satellite network… [NTN Direct] is being developed as the world’s first truly global, standards-based NB-IoT [narrowband IoT] and direct-to-device (D2D) non-terrestrial network (NTN) service. Unlike regional or cellular spectrum-based satellite solutions, Iridium NTN Direct is designed to deliver 100% global coverage, leveraging the existing constellation that already supports mission-critical communications worldwide. This approach reduces technical, regulatory and commercial barriers for partners, accelerating time to market.” 

The deal, which was agreed unanimously by the boards of both companies, is expected to close by the middle of next year. According to an investor deck, it will position the company as a “fully integrated, self-launching, Tier-1 space power” alongside the likes of Amazon/Globalstar and SpaceX/Starlink. 

“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,” stated 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 organisations 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.”

Iridium’s CEO, Matt Desch, added: “As the worlds of space and terrestrial communications continue to converge, more critical services will depend on space-based capabilities. 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 [positioning, navigation and timing] 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.”

- James Pearce, Editor, TelecomTV