AST SpaceMobile, the company building a space-based cellular broadband network directly accessible to everyday smartphones, today announced strategic investment from AT&T, Google and Vodafone and aggregate new financing of up to $206.5 million in gross proceeds. In addition to the $155 million strategic investment, the company also plans to draw up to $51.5 million from the company’s existing senior-secured credit facility.
This investment in AST SpaceMobile underscores confidence in the company’s technology and leadership position in the emerging space-based cellular direct-to-device market, with the potential to offer connectivity to today’s 5.5 billion cellular devices when they are out of coverage.
AST SpaceMobile currently operates the largest-ever commercial communications array in low Earth orbit, the BlueWalker 3 satellite. The company invented the space-based direct-to-device market, and its patented design facilitates broadband connectivity directly to standard, unmodified cellular devices, adhering to today’s cellular standards. In 2023, the company solidified its status as an innovator, working alongside partners AT&T, Vodafone, Rakuten and Nokia, to achieve multiple historic technical first-evers in space-based cellular communications – including the demonstration of 2G, 4G LTE and 5G calls, and 14 Mbps download speeds per 5 Mhz channels – directly from space to everyday smartphones. For the company’s planned operational satellites, beams are designed to support capacity of up to 40 Mhz, potentially enabling data transmission speeds of up to 120 Mbps. With over 40 agreements and understandings with mobile network operators globally, who collectively service over 2 billion subscribers, AST SpaceMobile’s pioneering in-orbit technology is poised to be the solution for eliminating cellular connectivity gaps around the world.
The strategic investment is intended to support the commercial roll-out of AST SpaceMobile’s network and is comprised of a mix of equity-linked capital and non-dilutive commercial payments. The investment includes:
- $110 million of 10-year subordinated convertible notes with 5.50% interest (which may be paid in kind), with a conversion price of $5.75 per share, a 39% premium to the final trading price on January 16, 2024; invested by AT&T, Google and Vodafone
- $20 million revenue commitment from AT&T, predicated on the launch and successful initial operation of the first 5 commercial satellites
- $25 million minimum revenue commitment from Vodafone, subject to a definitive agreement