AST SpaceMobile to repurchase $225 million of convertible notes

MIDLAND, Texas - AST SpaceMobile, Inc. (NASDAQ:ASTS), whose stock has surged 384.7% over the past year and is trading near its 52-week high of $54.05, announced Wednesday it will repurchase $225 million of its 4.25% convertible notes due 2032, removing approximately 8.3 million underlying shares from potential dilution.

The space-based cellular broadband network company, currently valued at $17.47 billion, will fund the repurchase by issuing 9.45 million shares of Class A common stock to participating note holders at $53.22 per share in a registered direct offering. The transactions are expected to close around July 1, 2025. According to InvestingPro, the company maintains strong liquidity with a current ratio of 10.62, indicating robust short-term financial health.

After the repurchase, $235 million of the 2032 convertible notes will remain outstanding. The company will eliminate approximately $63.8 million in remaining interest payments through this transaction.

"We are excited to retire approximately half of our 2032 convertible notes and the underlying shares at a price attractive to our shareholders," said Scott Wisniewski, AST SpaceMobile President, according to the company’s press release.

The company noted that its previously purchased capped call will remain outstanding and is expected to reduce dilution upon conversion of the remaining notes.

The repurchase will result in approximately 1.04 million incremental shares compared to the underlying shares of the notes being repurchased. Participating note holders may purchase or sell shares in the open market to adjust their hedge positions, which could affect the trading price of the company’s stock.

UBS Investment Bank is acting as placement agent and financial advisor for the transaction, with ICR Capital LLC also serving as financial advisor.

AST SpaceMobile is building what it describes as the first global cellular broadband network in space designed to work directly with standard mobile devices. Based on InvestingPro’s analysis, which includes 17+ additional insights and a comprehensive Pro Research Report, the stock appears to be trading above its Fair Value. Discover more detailed valuation metrics and financial health indicators with an InvestingPro subscription.

In other recent news, AST SpaceMobile has announced a strategic partnership with Vodafone Idea to enhance mobile connectivity in India’s underserved regions. This collaboration will integrate AST SpaceMobile’s satellite technology with Vodafone Idea’s network, offering direct-to-device connectivity without the need for specialized software. The partnership capitalizes on India’s vast telecom market, which includes over 1.1 billion mobile subscribers. Separately, AST SpaceMobile has secured access to up to 45 MHz of mid-band spectrum in the U.S. and Canada through a settlement with Ligado Networks, Viasat, and Inmarsat, pending court approval.

Additionally, AST SpaceMobile is set to join the Russell 1000 Index, reflecting its growing market capitalization and increased visibility among investors. The company has also updated its corporate governance structure, allowing for the removal of directors by written consent, following approval at its Annual Meeting. Shareholders elected all nominated directors and ratified KPMG LLP as the independent accounting firm for the fiscal year. These developments underscore AST SpaceMobile’s ongoing efforts to expand its technological and market reach.

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