June 29 (Reuters) – Rocket Lab said on Monday it would acquire satellite communications provider Iridium Communications in a cash-and-stock deal valued at about $8 billion, marking one of the biggest consolidation moves in the commercial space industry.
Iridium shareholders will receive $27 in cash as well as Rocket Lab shares, with a combined value of $54 per Iridium share — a 24.1% premium to the stock’s last close. The deal is expected to close in mid-2027.
Rocket Lab shares jumped 12% in premarket trading while Iridium shares, which have more than doubled in value already this year, soared about 22%.
The acquisition combines Rocket Lab’s launch vehicles and satellite-manufacturing business with Iridium’s global L-band satellite network, licensed spectrum and more than 2.5 million subscribers spanning government, defense, aviation, maritime and commercial markets.
Rocket Lab’s first purchase of a publicly traded company is also its largest deal, following a series of smaller acquisitions aimed at expanding its spacecraft-manufacturing and components business.
The acquisition, Rocket Lab said, would help it sidestep three “big challenges” to building a satellite communications business: access to spectrum, the long lead time to deploy infrastructure before generating revenue, and the years required to build a customer base and recurring cash flow.
“We’ve found a shortcut,” the company said in an investor presentation.
The strategy is similar to that of SpaceX and its unit Starlink, combining launch capabilities with satellite communications services. The Elon Musk-led company raised about $86 billion in the world’s biggest initial public offering earlier this month and has plans to expand its communications satellite business while developing orbital AI computing infrastructure.
Rocket Lab has secured commitments for a $3.6 billion bridge loan from Deutsche Bank and Wells Fargo to fund the cash portion of the acquisition. The company said it also plans to use cash on hand alongside additional debt and equity financing.
(Reporting by Akash Sriram in Bengaluru; Editing by Joyjeet Das)
