Rocket Lab (NASDAQ:RKLB) shares gained 5% on Monday after the company announced an agreement to acquire satellite communications provider Iridium Communications (NASDAQ:IRDM) in a transaction valued at approximately US$8 billion. Trading in Iridium shares was halted pending the announcement after the stock last traded at US$43.97.
Under the terms of the deal, Rocket Lab will purchase all outstanding Iridium shares for US$54 per share through a combination of cash and stock. Iridium shareholders will receive US$27.00 in cash, with the remainder paid in Rocket Lab shares based on an exchange ratio that will fluctuate within a collar ranging from US$67.50 to US$112.50.
Acquisition Expands Space Communications Capabilities
The combination brings together Rocket Lab’s launch services and satellite manufacturing operations with Iridium’s global low Earth orbit satellite communications network and valuable L-band spectrum assets.
Iridium currently serves more than 2.55 million active subscribers across government, defence, aviation, maritime and commercial markets. During 2025, the company generated revenue of US$871.7 million and EBITDA of US$495 million, representing an EBITDA margin of 57%.
Rocket Lab said the acquisition will significantly broaden its presence in space-based services, adding capabilities across satellite Internet of Things (IoT), direct-to-device communications, positioning, navigation and timing applications.
“By marrying Iridium’s deep heritage, trusted infrastructure, and highly sought-after spectrum with Rocket Lab’s extensive and proven launch and manufacturing capabilities, we have the capability to unlock entirely new markets,” said Peter Beck, founder and CEO of Rocket Lab.
Financing and Expected Closing
To support the transaction, Rocket Lab has secured commitments for a US$3.6 billion, 364-day senior secured bridge loan facility from Deutsche Bank and Wells Fargo. The company intends to finance the cash component through a combination of existing cash resources, debt financing and equity funding.
The acquisition has received unanimous approval from the boards of both companies and is expected to close during the middle of 2027, subject to approval by Iridium shareholders and the completion of required regulatory reviews.