Apple committed about $1.5 billion to satellite communications company Globalstar 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 current debt, and a 20% equity stake. The deal is expected to close on Tuesday.
Apple has already been spending hundreds of millions for Globlastar services, which enabled the 2022 rollout of iPhone emergency satellite texting.
It is one of several efforts in the direct-to-device, or D2D, satellite connectivity market — which provides service to unmodified devices such as smartphones directly from space — with other projects underway from SpaceX, AST SpaceMobile, Iridium, Lynk and EchoStar.
Globalstar stock jumped 31.4% in Friday trading to close at $1.38 a share.
In the filing, Globalstar noted that it will 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 as many as 26 satellites to replenish and upgrade its constellation in low Earth orbit.