Rocket Lab (NASDAQ: RKLB) has agreed to buy satellite operator Iridium Communications (NASDAQ: IRDM) in a cash-and-stock deal that values the target at roughly $8 billion and hands the launch company an instant communications business.
The acquisition gives Iridium stockholders an estimated $54 per share, split between $27 in cash and a variable number of Rocket Lab shares set by an exchange ratio, subject to a collar. That ratio carries a collar banded between $67.50 and $112.50, a structure meant to protect both sides from swings in Rocket Lab’s stock price before the deal closes.
Full mechanics will appear in the transaction agreement once it lands with the SEC.
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Rocket Lab has secured commitments for a $3.6 billion bridge loan from Deutsche Bank and Wells Fargo, and plans to fund the cash portion through a mix of balance sheet cash and additional debt and equity.
For Rocket Lab, the goal behind the transaction is vertical integration. The company already builds rockets and spacecraft, and Iridium supplies the missing piece, an operating satellite network with paying customers. The combined business would design, build, launch and run its own constellations rather than stopping at the launch pad.
Iridium runs a low Earth orbit network of satellites serving more than 2.55 million active subscribers across aviation, maritime, government, defense and commercial markets. Its globally coordinated L-band spectrum and weather-resilient coverage support voice, data and positioning services in places where GPS and other navigation systems falter. The company posted $871.7 million in revenue in 2025 and operational EBITDA of $495 million, a margin of 57%, giving Rocket Lab a recurring cash flow stream it has never had before.
Sir Peter Beck, Rocket Lab’s founder and chief executive, framed the transaction as a turning point. “This is a defining moment for the space industry and the start of a new era of strategic, accelerated growth for Rocket Lab and Iridium,” he said, describing Iridium’s network as the gold standard in secure, safety-critical satellite connectivity and arguing that pairing it with Rocket Lab’s manufacturing muscle would open markets neither could reach alone.
The strategic appeal runs in both directions. Owning launch capacity should let Rocket Lab eliminate third-party launch costs as it deploys and replenishes the Iridium constellation, capturing that margin internally at a moment when orbital access is getting harder to secure. The deal also unites two long-standing government partners, with potential applications in direct-to-device connectivity and national security.
Both boards have unanimously approved the transaction, and Iridium directors have signed a voting agreement in support of the deal. The companies expect to close in mid-2027, pending approval from Iridium stockholders and regulators.
Rocket Lab last traded at $84.54 on the NASDAQ.
