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9h ago

Rocket Lab to Buy Iridium in About $8 Billion Cash-and-Stock Deal

The transaction shifts Rocket Lab toward recurring satellite revenue as it secures a $3.6 billion bridge loan and plans further debt and equity financing.

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Rocket Lab has signed a definitive agreement to acquire Iridium. The acquisition will be one of the most transformative deals in the space industry, joining together two innovative American companies to play a leading role in the U.S. space economy. It merges Rocket Lab's leading 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.

Overview

  • The deal values Iridium at about $8 billion, offering Iridium shareholders $27 in cash plus Rocket Lab shares for a combined $54 per share and targets a close in mid-2027.
  • Rocket Lab has secured commitments for a $3.6 billion bridge loan from Deutsche Bank and Wells Fargo and says it will use cash on hand plus additional debt and equity to fund the purchase.
  • The acquisition pairs Rocket Lab’s launch vehicles and satellite manufacturing with Iridium’s global L‑band constellation, licensed spectrum, and more than 2.5 million subscribers.
  • The companies say the tie-up will give Rocket Lab steady subscription revenue and let it deploy and replenish satellites with its own rockets, but the deal raises near-term questions about shareholder dilution and heavy financing needs.
  • The purchase is Rocket Lab’s largest and first buy of a public company and follows a string of prior acquisitions as the firm pursues vertical integration and a different, more predictable business mix than launch contracts alone.