apple It allocated about $1.5 billion to the satellite communications company Global Star To fund the expansion of iPhone services, the companies disclosed in a securities filing on Friday.
The tech giant's deal with Globalstar includes $1.1 billion in cash, of which $232 million will go toward the satellite company's existing debt, and a 20% equity stake. The deal is expected to close on Tuesday.
Apple has already spent hundreds of millions on Globlastar services, enabling emergency satellite text messaging to launch on the iPhone in 2022.
It's one of several efforts in the direct-to-device, or D2D, satellite communications market, which provides service to unmodified devices like smartphones directly from space, with other projects underway from SpaceX. Astspace Mobile, Iridium, Link and Ecostar.
Globalstar shares jumped 31.4% in trading on Friday, closing at $1.38 per share.
In its filing, Globalstar indicated that it would continue to allocate about 85% of its network capacity to Apple.
The new funds will allow Globalstar to purchase new satellites and expand its ground infrastructure. Globalstar currently operates 31 satellites and has already ordered up to 26 satellites to replenish and upgrade its constellation in low Earth orbit.
