Episode summary
Amazon to Buy Satellite Operator Globalstar for $90 a Share | Bloomberg Intelligence
Bloomberg Intelligence
· · Hosts: Paul Sweeney, Scarlet Fu · Guests: Michelle Davis, Sid Philip, Craig Trudell, Herman Chan
Summary
Amazon agreed to buy satellite operator Globalstar for roughly $11.6 billion to accelerate its push into space-based connectivity. The guest said the deal is mainly about spectrum, ground infrastructure and keeping Apple as a major customer, while also helping Amazon move toward a direct-to-device satellite service it hopes to launch by 2028. The guest also noted that regulators have generally been open to spectrum transactions, though Amazon still trails SpaceX by a wide margin in satellites already in orbit.
The discussion then turned to airlines, where United chief executive Scott Kirby floated a possible combination with American Airlines. The guest said the idea is likely a test of how friendly the Trump administration will be to large mergers, but emphasized that antitrust opposition from rivals, consumer groups and lawmakers would make approval difficult. The guest also linked the speculation to higher oil prices, saying that consolidation often appears when weaker carriers are under pressure.
Lucid Group also announced a leadership change, naming Silvio Napoli as chief executive officer and securing $750 million from the Saudi Public Investment Fund and Uber. The guest said Lucid is still struggling to scale production profitably, even as it pivots toward a more mainstream vehicle strategy. A later banking discussion highlighted stronger earnings at the biggest U.S. lenders, growing loan books in private credit and other non-bank niches, and Wells Fargo’s return to growth after its asset cap was lifted.
Key takeaways
- Amazon’s Globalstar purchase is a spectrum play that also preserves Apple-related satellite service revenue, according to the guest.
- The guest said Amazon still lags SpaceX in satellite deployment, so the deal speeds strategy but does not close the gap.
- A United-American merger would face major antitrust resistance even if the Trump administration is more merger-friendly, the guest said.
- Lucid’s new CEO inherits a business that still has not solved profitable mass production, despite $750 million in fresh backing.
- Bank lenders are seeing growth in private-credit and other non-bank financing, while higher rates and fuel costs are pressuring some consumer demand.
Notable quotes
“this deal is all about basically, you know, there's a massive rate to race to dominate space-based connectivity”
“it would create the largest airline on the planet, and it still wouldn't be I mean, they still only have a third of the US market share combined”
“this is a company that has really been been struggling to execute, make some really appealing and interesting electric vehicles”
“They're probably going to be the the fastest growing GSIB bank that we cover”
How the episode opens
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Listen on demand wherever you get your podcasts or watch us live on YouTube. Little M&A trade today here, not so little for the seller here, but we're Amazon. Amazon, which doesn't do a lot of acquisitions, they agreed to acquire satellite operator Globalstar in a roughly $11.6 billion deal to boost its satellite operation.
Okay, Michelle Davis, she's got the details, senior deals reporter for Bloomberg News here. Michelle, what's Amazon up to these days? You know, this deal is all about basically, you know, there's a massive rate to race to dominate space-based connectivity.
All the tech giants are trying to do it. SpaceX is obviously the leader. Amazon also has a big ambitions to be a leader in satellites, and this deal's all about spectrum.
Globalstar has really valuable which is think of it as real estate that's, you know, a scarce asset. Whoever got it first was able to sell it later on, and that's that's how Globalstar ended up, you know, being able to sell this to to Amazon. And not only are they getting spectrum with this deal, they're also getting infrastructure on the ground and a massive customer in Apple.
Apple's one of Globalstar's big customers as part of the deal. Amazon was able to negotiate basically, you know, keeping Apple on board and they'll be using the Apple will be using its services to provide, you know, emergency services. If you're out hiking and there's no no cell service, you can use satellites to call 911 or, you know, people can find you on Find My Friends, basically.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- amazon satellite acquisition
- airline merger antitrust
- lucid ceo appointment investment
- us bank earnings private credit
- ai credit quality concerns
Companies and tickers mentioned
- AMZN
- GSAT
- UAL
- AAL
- LCID
- Amazon.com
- Globalstar
- United Airlines
- American Airlines
- Lucid Group
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Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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