Satellite company AST SpaceMobile launched a $75 million public offering by agreeing to sell 13.64 million shares of its Class A common stock for $5.50 per share. The company is also allowing the underwriter, B. Riley Securities, a 30-day option of purchasing slightly more than 2 million shares at the public offering price to raise an additional $11.25 million. The offering is expected to close December 2.
The company didn’t specify what it plans to use the funds for, except to say proceeds will be used for “general corporate purposes.” However, the company has said in the past that it needs to raise money to launch more satellites. AST told Fierce Wireless earlier this month that it plans to launch five satellites in 2023.
AST SpaceMobile’s overall satellite constellation plan calls for 168 satellites but so far it only has two satellites in orbit. It has a test satellite it launched in 2019, and earlier this year it launched the BlueWalker 3 satellite. Earlier this month AST announced it had successfully unfolded, while in orbit, the communications array for BlueWalker 3.
Besides launching satellites, AST also has to obtain spectrum approvals from the FCC and ITU before it can offer its satellite to cellular connectivity.
Nevertheless, AST SpaceMobile is quickly becoming a prominent player in the low-Earth satellite network world, particularly as wireless operators look to LEO satellite companies to provide connectivity to their mobile phone users when they are in areas without terrestrial coverage. The company’s partners include AT&T, Rakuten Mobile, Vodafone and American Tower.
Last month AT&T CEO John Stankey confirmed that the operator is working with AST to provide connectivity in dead zones in the U.S. and said that AT&T is about 18 months ahead of competitor T-Mobile, which announced in August that was working with SpaceX on a similar satellite-to-cellular connectivity service to provide coverage in dead zones.
Stankey said that initially the satellite service will be for emergencies, including providing connectivity for FirstNet, the company’s public safety network. But AT&T also plans to launch a consumer application that would incorporate the satellite connectivity, Stankey said.