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(Sharecast News) - Rocket Lab said on Monday that it has agreed to buy satellite communications provider Iridium in a $8bn cash and stock deal.
Rocket Lab is a space company that provides launch services, spacecraft, payloads and satellite components serving commercial, government, and national security markets. Its Electron rocket is the world's most frequently launched orbital small rocket, while the company's HASTE rocket provides hypersonic test launch capability for the US government and allied nations.
Iridium operates a global mobile satellite network, delivering reliable voice, data, and positioning, navigation, and timing (PNT) services anywhere on earth, Rocket Lab said.
Under the terms of the transaction, Iridium shareholders will receive $27 per share in cash plus Rocket Lab shares, with a total value of $54 per share.
Rocket Lab said the deal will merge its 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".
Sir Peter Beck, founder and chief executive of Rocket Lab, said: "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.
"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."
At 1522 BST, Iridium shares were 21% higher at $52.84, while Rocket Lab was up 8.2% at $91.50.