00:00When did Amazon start getting interested. So we've heard that Amazon started getting interested interested last year and global
00:06star is an asset that's kind of been out there for years. People have always talked about it as the
00:11key kind of the jigsaw piece in
00:14the puzzle that you know if you bought it because of all of its spectrum it would help you get
00:19up to speed and kind of dominate the
00:21satellite market. And so that's what it really is about. It's the spectrum. We heard that SpaceX had also looked
00:27at this asset
00:28last year. Of course Amazon prevailed. And you know both of these players have been racing to dominate the space
00:34based
00:34connectivity market. And Starlink is clearly ahead. But what this does is it really accelerates for Amazon their plans to
00:42be
00:42a formidable competitor to to Starlink. Michelle really interesting one for the deals team. Right. Like Amazon the tech giant
00:49that it is has never gone that big on M&A. But I think I'm right in saying that global
00:54star pending close etc. would be
00:57its second biggest ever deal. You know what do we make of it. And what was the reporting around the
01:03offer. How how
01:04competitive it was. And how Amazon really wanted to go for this. You're right. I mean this is Amazon's biggest
01:11deal since
01:122017 when it bought Whole Foods. Amazon's been known to kind of go after different parts of the market. You
01:19know everything from
01:20health care to movie studios to now of course this big spectrum satellite play. And what we were hearing is
01:27that global star was
01:28really looking for a value above 10 billion dollars. And the deal that was announced today is that a huge
01:33premium to you know more
01:34than 100 percent premium to where the stock was trading when the leak first hit you know last October. And
01:41so I mean it clearly shows
01:42there aren't that many players out there that can afford to spend this much money on something like this. But
01:48if you want to win in
01:49this market. That's what it takes. And the advice they've been getting from banks is the way in which that
01:54they structure
01:54this not just in terms of premium but in terms of what's on the offer. It's either shares or indeed
02:00it's straight up cash.
02:02Exactly. Yeah. So it's a mix of stock and cash. There's a 40 percent cap on the amount of cash
02:08that shareholders can get.
02:10And that means they'll get up to a cap of 90 dollars per share up to 40 percent. The way
02:15that works is basically a few days
02:16before the deal is going to close. Shareholders will get to elect what they want. Do they want. You could
02:21say I want all stock
02:22or I want all cash because of course Amazon stock is valuable. But at the end of the day assuming
02:27everyone elected all cash the
02:28most you could get is 40 percent 40 percent in cash. So it'll be prorated depending on what folks elect.
02:35Really appreciate you
02:36breaking down the deal structure. You know this has been out there for a couple of weeks. Now it's confirmed
02:42in that
02:43period. What was industry saying about this. Right. Like the big picture is oh Amazon's going to go off to
02:49Starlink. But they were actually if you look at the specific details you know in terms of L.A.O.
02:54they have a lot of existing assets. Amazon does. What was our read on the strategic play from Amazon.
03:00So Amazon really needed the the spectrum to to really accelerate its desire to get into that direct to
03:07device market which it said today it's going to do in 2028. And what that'll do is it means you
03:12know
03:13consumers will be able to get text video data you know voice using satellite service rather than cell towers
03:20kind of like a cell tower in space. But it really what it does is helps Amazon catch up. They
03:26haven't been able
03:27to launch as many satellites as SpaceX has. That's the biggest one of the biggest reasons why they've
03:33been behind. But this this piece is really complementary to everything that they do already have.
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