Amazon to Acquire Apple's Globalstar Stake in Satellite Deal

[MacRumors]

Amazon is acquiring Apple satellite provider Globalstar, and it has worked out a deal to take over Apple's stake in the satellite company.

According to an FCC filing noticed by PCMag, Amazon is initiating a merger structure. It will create a new subsidiary called Grapefruit Acquisition Sub II to absorb Globalstar's operations, and then the new subsidiary will acquire Apple's equity.

Apple has 20 percent equity and 20 percent voting interests in Globalstar Licensee LLC, a Globalstar subsidiary that operates the satellite system that delivers satellite connectivity to iPhone users in the U.S. Apple invested $450 million in Globalstar back in 2022 to fund Globalstar's satellite buildout for the Emergency SOS via satellite feature. Apple received 20 percent equity and 85 percent of Globalstar's network capacity in return.

Apple's Globalstar stake required Apple and Amazon to enter into separate negotiations, but the two companies worked out a deal. Amazon's Leo satellite network will power existing iPhone and Apple Watch satellite features like Emergency SOS, Messages via satellite, Find My, and Roadside Assistance via satellite. Apple stands to make more money than it invested, and has secured a partnership with a better-established satellite operator.

Amazon will support iPhone and Apple Watch models that use Globalstar's low Earth orbit constellation, and the two companies will work together on future satellite services running on Amazon's expanded Leo network.

Amazon's Globalstar purchase is said to be worth around $11.57 billion, and it is expected to close in 2027 as long as it earns regulatory approval.

Article Link: Amazon to Acquire Apple's Globalstar Stake in Satellite Deal

 

[CoMoMacUser]

I want to hear the story behind the Grapefruit Acquisition Sub II name.

 

[Kar98]

At one point soon, those giga corps need to be broken up again.

 

[hieranonymous]

Elon’s gonna pitch a fit. He’s been angling for Apple to use Starlink.

 

[goobot]

I don’t understand why Amazon would want to buy this, if Apple is using 85% capacity what does Amazon have to gain here

 

[jz0309]

I can see the appeal for Amazon to acquire Globalstar as they are waaayyyy behind on satellites, behind Starlink that is.

But I think the "free" days of satellite services will come to an end, rather sooner than later, of course depending on what Apple negotiated.

 

[macvicta]

I don’t understand why Amazon would want to buy this, if Apple is using 85% capacity what does Amazon have to gain here

They’re not gonna be using 85% anymore.

 

[jz0309]

I don’t understand why Amazon would want to buy this, if Apple is using 85% capacity what does Amazon have to gain here

a key customer who is expanding on satellite capabilities, 150M or so (whatever the exact # of iPhone Po and AWU comes to) new potential users, every year. Even if it were 50M, a huge customer base cause charging for those services is the future

 

[ThomasJL]

Emergency services are highly important. I hope Jeff Bozos doesn't do anything to maximize profits by cutting back on the emergency service-related functionality for iPhones that Apple already has and has already planned. I don't trust Jeff Bozos because he is extremely greedy, even more so than Tim Crook.

 

[M4irmidnight]

Emergency services are highly important. I hope Jeff Bozos doesn't do anything to maximize profits by cutting back on the emergency service-related functionality for iPhones that Apple already has and has already planned. I don't trust Jeff Bozos because he is extremely greedy, even more so than Tim Crook.

Are you a prime member?

Yes? Then you live.
No? Too bad , so sad.

 

[frenchcamp49er]

At one point soon, those giga corps need to be broken up again.

They actually dont

 

[frenchcamp49er]

Are you a prime member?

Yes? Then you live.
No? Too bad , so sad.

This will be an Apple feature and not tied to Prime.

 

[schappim]

I want to hear the story behind the Grapefruit Acquisition Sub II name.

Came here to say this too!

 

[schappim]

Elon’s gonna pitch a fit. He’s been angling for Apple to use Starlink.

Apple is pretty anti-Elon, and don't forget Elon via xAI was suing Apple and ChatGPT's OpenAI for allegedly thwarting competition...

 

[Spanky Deluxe]

Apple invested 450 million USD for 20% equity. The deal is said to be worth 11.57 billion USD. "Apple stands to make more money than it invested" is a bit of an understatement. They will have made a 1.864 billion USD profit in 5 years. Pretty decent!