Amazon to Buy Apple’s Stake in Globalstar: Major Shift in Satellite Communications!

Amazon’s Acquisition of Globalstar Includes Apple’s Stake

Last month’s announcement that Amazon will acquire Globalstar also encompasses the purchase of Apple’s 20% stake in the satellite communications company. According to a filing with the FCC, which was noted by PCMag, Amazon plans to establish a subsidiary named Grapefruit Acquisition Sub II to manage this transaction and acquire Apple’s shares. Two years ago, Apple invested $400 million to secure these shares, contingent upon an overall investment of $1.1 billion. Thus, Apple’s total expenditure to gain 20% ownership was $1.5 billion, while Amazon’s purchase price for the entire company amounts to $11.57 billion.

Financial Gains and Strategic Shifts for Apple

With this deal, Apple is set to double its initial investment. However, it will lose its contractual right to 85% of Globalstar’s satellite capacity. Despite this, Apple gains a new partner in Amazon, which boasts considerably more robust financial backing. Amazon had previously revealed its plans to work with Apple on upcoming satellite services. In its FCC filing, Amazon explicitly stated, “Amazon’s investment in expanding the constellation and technological enhancements will strengthen the mobile satellite services (MSS) at 1.6/2.4 GHz, which millions of iPhone users currently rely on for safety in areas without cellular coverage.“