Key insights
- Globalstar shares surged on reports of Amazon takeover talks, driven by Amazon's desire to expand its satellite business and compete with Starlink. Apple's 20% stake in Globalstar adds complexity to the deal. While positive for Globalstar, the broader market impact is limited, primarily affecting satellite communication stocks.
Investing.com-- Globalstar shares surged to an 18-year high in aftermarket trade on Wednesday after the Financial Times reported Amazon.com was in talks to take over the satellite telecommunications firm.
Globalstar Inc (NASDAQ:GSAT) shares jumped about 16% afterhours to $79.70, their highest level since early-2008.
The Financial Times reported that Amazon.com Inc (NASDAQ:AMZN) was in talks to acquire the firm, in a likely bid to boost its low Earth orbit satellite business and compete with Elon Musk’s Starlink.
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The two sides were still negotiating over the complexities of a deal, the FT said, with one complicating factor being Apple Inc’s (NASDAQ:AAPL) 20% stake in Globalstar, necessitating negotiations between Amazon and the iPhone maker.
Globalstar shares are up some 230% in the past 12 months, amid speculation that it could attract takeover interest due to being a potential competitor to Starlink, the low orbit satellite telecommunications unit of SpaceX.
Apple invested $1.5 billion in Globalstar in 2024.
Amazon has been pushing ahead with its own satellite effort, dubbed Leo, and has more than 180 satellites in orbit– a fraction of the over 10,000-strong fleet operated by SpaceX.