Shares of Rocket Lab Corporation (NASDAQ:RKLB) climbed 11.19% during the pre-market trading session on Monday after it announced its intention to acquire Iridium Communications Inc. (NASDAQ:IRDM), marking a substantial expansion into the realm of space-based applications.
Shares of Iridium Communications rose 20.86% during the pre-market session.
Rocket Lab plans to buy all outstanding shares of Iridium common stock for $54 per share. This cash and stock transaction places the value of Iridium at roughly $8 billion.
“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,” stated Sir Peter Beck, founder and CEO of Rocket Lab.
Rocket Lab Targets New Markets
This acquisition comes on the heels of Rocket Lab’s inclusion in the Nasdaq-100, last week. The company’s stock was one of five additions to the Nasdaq-100, a move that created a one-time demand as passive vehicles rebalanced. However, the space sector has seen a rotation-heavy period following SpaceX’s IPO on June 12, leading to a sell-off of Rocket Lab and other space stocks.
The potential deal gives Rocket Lab an immediate presence in space-based telecom services, including satellite IoT, direct-to-device connectivity, positioning and navigation, and critical safety services, strengthening its position in the global telecom market.
Rocket Lab plans to use Iridium’s LEO satellite network and globally harmonized L-band spectrum to expand into new markets and deliver secure satellite communications and positioning services worldwide.
Benzinga’s Edge Rankings place Rocket Labs in the 93rd percentile for momentum. Benzinga’s screener allows you to compare RKLB’s performance with its peers.
RKLB Price Action: On a year-to-date basis, Rocket Lab shares surged 11.25%, as per data from Benzinga Pro.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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