AST SpaceMobile, a company building a space-based cellular broadband network accessible directly by standard mobile phones, has raised $75 million and partnered with Brazilian telco TIM Brasil.
Last month they closed an offering of Class A Common Stock, raising gross proceeds of $75 million. B. Riley Securities, Inc. was the sole book-running manager of the offering.
The company has also granted B. Riley a 30-day option to purchase additional shares that would raise another $11.25m in gross proceeds.
“We are pleased to announce this successful capital raise as we continue executing our mission of connecting the unconnected,” said Sean Wallace, Chief Financial Officer of AST SpaceMobile. “We were excited to see the demand for this offering, which allowed us to upsize the offering from $65m. We welcome all of our new stockholders.”
The company said proceeds will be used for general corporate purposes and will help fund the production and launch of the first phase of the firm’s commercial satellites.
First reported by BNAmericas, the satellite firm has also signed a Memorandum of Understanding (MoU) to provide 4G coverage to remote locations in the country. The proposal will allow the operator to test AST SpaceMobile's satellite to provide 4G data and voice services in Brazil.
The expectation is that TIM will carry out the first technical tests in the North and Northeast regions of Brazil in the first half of 2023.
“TIM, the only operator to serve all municipalities in Brazil with mobile coverage, reinforces its commitment to expand its coverage area and improve the quality of communication so that customers can enjoy data and voice services anywhere in the country,” said Marco Di Costanzo, director of Network Development at TIM Brasil. “The agreement with AST SpaceMobile complements important ongoing initiatives to promote more digital inclusion, as it will allow TIM to take 4G to isolated areas, districts, villages, roads, resorts, and tourist spots that today are not served by other operators.”
Founded in 2017 and previously known as AST & Science, the company was listed on the Nasdaq in 2021 after a SPAC merger with New Providence Acquisition Corp.
AST was planning a constellation of almost 170 satellites; the first 20 were originally due to enter operation by 2023 with another 90 deployed through 2024. According to more recent press releases, it seems to have revised its constellation plans down to 100.
The first test satellite, Bluewalker 1 was launched in 2019; Bluewalker 2 was canceled. Its latest test satellite, Bluewalker 3, launched last year.
The company has previously announced commercial agreements with Vodafone and AT&T, with MoUs signed with Telefonica, Orange, Indosat Ooredoo, Tigo, Telstra, Smartfren Telecom in Indonesia, and others. It has also signed an agreement with Rakuten.
AST isn't the only company looking to provide connectivity directly to smartphone users. Satellite base-station company Lynk (formerly UbiquitiLink) deployed its Lynk Tower 1 satellite into orbit last year and deployed two more this month. A fourth satellite is also planned as part of the initial roll-out, with a limited commercial launch set for sometime in 2023.
So far Lynk has signed contracts with operators on seven island nations in the Pacific and Caribbean, including Telikom Limited in Papua New Guinea, Aliv in the Bahamas, and bmobile in the Solomon Islands, as well as Mongolia’s Unitel and Telecel Centrafrique in the Central African Republic.
Elon Musk's SpaceX recently struck a deal with US operator T-Mobile to provide mobile signal connectivity from space, via its Starlink satellites. T-Mobile is hopeful the venture will provide speeds of 2-4 Mbps through Starlink's satellites.
Qualcomm has partnered with Iridium to provide satellite connectivity to future Android phones, while Bullit and Apple are also rolling out similar capabilities.