(Reuters) – Globalstar on Tuesday named former Qualcomm top boss Paul Jacobs as its CEO, sparking a near 20% surge in the shares of the satellite firm behind Apple’s emergency communication services.
Jacobs, 60, is also a board member of IPO-bound chip firm Arm and will replace David Kagan, who is retiring after about 5 years as CEO.
Globalstar also said it had signed a deal with XCOM Labs, a wireless tech startup that Jacobs co-founded and most recently led, for exclusive access to certain key technologies and personnel.
It will pay XCOM licensing fees including the issuance of about 60 million common stock shares valued at around $64 million.
Jacobs served as Qualcomm’s CEO for nearly a decade from 2005, steering the chip company into becoming one of the key suppliers of the global smartphone industry. He was nudged out of its board in 2018 after disclosing his intention to pursue a long-shot acquisition of the firm.
“We have … a close working relationship with the XCOM team over the last 20 years,” said Globalstar Executive Chairman Jay Monroe. “Some of XCOM’s leaders contributed to the original Globalstar system while at Qualcomm.”
The satellite company partnered last year with Apple to enable a service that allows the iPhone 14 to send distress signals from areas without cellular network.
Apple pledged $450 million to the development of its emergency SOS infrastructure in November, with the majority of the amount going to Globalstar, but it did not specify which other players would receive the rest.
The deal tethered Globalstar’s future to one of the biggest companies in the world in an industry where players have struggled to turn profits in the face of high maintenance costs.
Iridium Comunications partnered with Qualcomm earlier in May to develop emergency SOS messaging for Android users, going head-to-head with Apple.
(Reporting by Arsheeya Bajwa in Bengaluru; Editing by Devika Syamnath)
