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.
