Key Takeaways:
- Rocket Lab to acquire Iridium for $54 per share in cash and stock
- Deal valued at approximately $8 billion enterprise value
- Iridium generated $871.7 million revenue and $495 million OEBITDA in 2025
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Rocket Lab to acquire Iridium for $8 billion in cash-and-stock deal
Rocket Lab Corp. agreed to acquire Iridium Communications Inc. for $54 a share in a cash-and-stock transaction valued at about $8 billion, merging a launch and satellite manufacturer with a global satellite network operator to create a vertically integrated space company.
"The combination of Rocket Lab's launch and manufacturing capabilities with Iridium's network and spectrum will unlock entirely new markets," said Sir Peter Beck, founder and chief executive officer of Rocket Lab. "We are going to build upon Iridium's legacy to pioneer next-generation space applications."
Iridium stockholders will receive $27 in cash plus a variable number of Rocket Lab shares determined by an exchange ratio with a collar between $67.50 and $112.50. The deal represents a significant premium for Iridium, which generated $871.7 million in revenue and $495 million in operational EBITDA in 2025, a 57 percent margin, according to the company's public filings. The McLean, Virginia-based operator supports more than 2.55 million active subscribers through a network of 500-plus partner companies.
The acquisition gives Rocket Lab immediate access to Iridium's globally harmonized L-band spectrum and low Earth orbit satellite constellation, which provides voice, data, and positioning, navigation, and timing services across government, defense, aviation, maritime, and commercial markets. The combined company will design, build, launch, and operate its own satellites, eliminating third-party launch costs for constellation deployment and replenishment. Rocket Lab has secured a $3.6 billion 364-day senior secured bridge term loan from Deutsche Bank and Wells Fargo to help fund the cash component, with plans to use additional balance sheet cash and other debt and equity financing. The transaction, unanimously approved by both companies' boards, is expected to close in mid-2027 pending Iridium stockholder approval and regulatory clearances.
Strategic Rationale
The deal marks a shift for Rocket Lab from a hardware-focused supplier of launch services and satellite components into a fully integrated space services company with recurring revenue. Rather than simply maintaining the existing Iridium network, Rocket Lab plans to build upon it to scale into direct-to-device communications, satellite Internet of Things, and alternative positioning and timing services that function when GPS is degraded or unavailable. Iridium's L-band spectrum is particularly valuable because it is globally harmonized and weather-resilient, making it suitable for safety-of-life applications in aviation, maritime, and defense.
Deal Structure and Financing
Deutsche Bank Securities is serving as lead financial advisor to Rocket Lab, with Wells Fargo and PJT Partners also advising. Wilson Sonsini Goodrich & Rosati is providing legal counsel, with Goodwin Procter on financing and DLA Piper on regulatory matters. Evercore is the exclusive financial advisor to Iridium, with Davis Polk & Wardwell as legal counsel. Iridium directors holding shares have entered into voting agreements to support the transaction, and each member of Iridium's board has unanimously approved the deal.
The acquisition follows a series of smaller Rocket Lab acquisitions this year, including Motiv Space Systems in May and Mynaric in April, as the company has pursued vertical integration across launch, spacecraft components, and now satellite communications services.
This article is for informational purposes only and does not constitute investment advice.
