GSAT Stock On Track To Hit 18-Year High As Amazon Acquires Globalstar For Over 23% Premium

• The deal aims to boost direct-to-device connectivity, enabling smartphones and other devices to link directly to satellites.
• Globalstar shareholders may elect to receive either $90 in cash per share or 0.3210 Amazon shares, with the share option capped at a $90 value per share.
• Separately, Amazon has reached an agreement with Apple to enable satellite connectivity features on iPhones.

Globalstar Inc. (GSAT) is on track to hit April 2008 highs after Amazon.com Inc. (AMZN) agreed to acquire the satellite-based telecommunications provider. 

The move is expected to boost Amazon’s ambition to deliver direct satellite-to-phone communications and expand coverage beyond traditional cellular limits.

Amazon To Integrate Globalstar’s Satellite Assets

Under the deal announced Tuesday, Amazon will integrate Globalstar’s satellite operations, spectrum rights, and infrastructure into the growing Amazon Leo low Earth orbit network. 

The companies said the combination will strengthen efforts to deliver direct-to-device (D2D) connectivity, allowing smartphones and other devices to connect directly to satellites without relying solely on ground towers. 

“We have long believed low Earth orbit satellite constellations offer the most effective path to truly connect users and devices anywhere and anytime.”

-Paul Jacobs, CEO, Globalstar. 

Globalstar shareholders can choose either $90 in cash per share or 0.3210 Amazon shares (capped at $90 value per share), with a proration rule limiting total cash payouts to 40% and converting excess cash elections into stock on a pro rata basis. The offer price implies over 23% premium to Globalstar’s closing price on Monday. 

Following the announcement, Globalstar stock traded over 10% higher in Tuesday’s premarket. 

Building A Global Satellite Ecosystem

Amazon said the acquisition will help unify Globalstar’s mobile satellite services expertise with its own expanding Leo constellation.

“There are billions of customers out there living, traveling, and operating in places beyond the reach of existing networks, and we started Amazon Leo to help bridge that divide.”

-Panos Panay, Senior Vice President of Devices & Services, Amazon.

Amazon also outlined plans to launch its next-generation D2D satellite system beginning in 2028. The upgraded network will enable voice, messaging, and data services directly on standard mobile devices without specialized hardware.

The company said the system will integrate with earlier Leo deployments to form a unified architecture capable of supporting hundreds of millions of users globally with improved speed and efficiency compared to legacy satellite systems.

In a parallel development, Amazon has also secured an agreement with Apple Inc. (AAPL) to support satellite connectivity features for iPhones and Apple Watches, including emergency messaging tools such as Emergency SOS via satellite.

What Are Retail Traders Saying? 

On Stocktwits, retail sentiment around the stock shifted to ‘extremely bullish’ from ‘bullish’ territory the previous day. Message volume flipped to ‘high’ from ‘low’ levels in 24 hours. 

The stock saw a whopping 3,440% surge in message volume over a 24-hour period. 

Stocktwits users wondered whether Elon Musk’s Starlink would make a better offer. 

GSAT stock has gained over 19% year-to-date. 

Also See: Why Is HUBC Stock Spiking After A Sharp Selloff?

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