Shares of Rocket Lab (NASDAQ:RKLB) climbed about 5% on Monday after the company disclosed an agreement to acquire Iridium Communications (NASDAQ:IRDM) in a deal valued at approximately $8 billion. Iridium shares were put on a regulatory halt at $43.97 and were anticipated to resume trading at a higher price.
Under the terms of the arrangement, Rocket Lab will purchase all outstanding Iridium stock for $54.00 per share using a mix of cash and Rocket Lab equity. Iridium shareholders will receive $27.00 in cash plus Rocket Lab shares determined by an exchange ratio. That exchange ratio is governed by a collar that ties the Rocket Lab share component to a band ranging from $67.50 to $112.50.
The transaction is presented as a strategic combination of capabilities: Rocket Lab’s rocket launch and satellite manufacturing operations together with Iridium’s satellite communications platform and L-band spectrum assets. Iridium currently operates a low Earth orbit satellite constellation and serves more than 2.55 million active subscribers across government, defense, aviation, maritime, and commercial segments.
Financial metrics cited in the agreement show Iridium generated $871.7 million of revenue and $495 million of EBITDA in 2025, which corresponds to a reported EBITDA margin of 57% for that period. Rocket Lab said the acquisition will grant it immediate entry into a range of space-based services, including satellite Internet of Things, direct-to-device connectivity, and positioning, navigation, and timing functions.
"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.
To support the cash portion of the deal, Rocket Lab has obtained commitments for a 364-day senior secured bridge term loan facility totaling $3.6 billion from Deutsche Bank and Wells Fargo. The company indicated it intends to finance the cash consideration through a mix of its balance sheet cash and additional debt and equity financing sources.
Both companies’ boards have given unanimous approval to the transaction. The deal remains subject to approval by Iridium stockholders and regulatory clearances, with the parties targeting a closing in mid-2027, according to the announcement.
The acquisition brings together a manufacturer and launch provider with a satellite network operator, positioning the combined company to address a variety of market segments that rely on space-based connectivity and timing. The immediate access to Iridium’s spectrum and subscriber base is presented as a primary strategic rationale for Rocket Lab’s offer.
Investors responded in early trading with gains in Rocket Lab shares and a trading halt on Iridium stock pending the market reaction. The companies will need to obtain stockholder consent and navigate regulatory review before the transaction can be completed in the target window.