(Reuters) – Satellite network company AST & Science said on Wednesday it had agreed to be taken public by blank-check firm New Providence Acquisition Corp in a deal that values the combined firm at $1.4 billion including debt.
The Midland, Texas-based company, also known as AST SpaceMobile, said it plans to launch the world’s first low-earth-orbit, low-latency satellite network to connect directly to a smartphone.
The network will help to fortify a partner mobile operator’s coverage in areas where signals are weak or undergo disruption, with users automatically switching from the land network to the space network.
AST’s investors including mobile operator Vodafone Group Plc, Japan’s Rakuten Inc, American Tower, and Cisneros will increase their equity holding in the company, it said. The combined company expects to raise $462 million in gross proceeds.
The merged entity will list on the Nasdaq under the symbol “ASTS”, the company said.
New Providence Acquisition is a special purpose acquisition company (SPAC) that raised $230 million in its initial public offering in September 2019.
A SPAC is a shell company that buys an operating entity, typically within two years, and has emerged as a quick route to the stock market for companies this year such as Virgin Galactic Holdings Inc and DraftKings Inc.
Reporting by Sohini Podder and Noor Zainab Hussain in Bengaluru; Editing by Ramakrishnan M.