Regulatory turbulence at the Federal Communications Commission is turning a merger review into a live share-price event for Rocket Lab (NASDAQ: RKLB), which fell 6% to $63.82 on Friday.
SpaceX filed a complaint asking the FCC to scrutinize Iridium Communications (NASDAQ: IRDM) conduct as the agency reviews applications tied to Rocket Lab’s pending $8 billion acquisition of the satellite operator.
SpaceX satellite policy associate Matthew Turk asserted that “Iridium’s well-documented history of anticompetitive attacks against its competitors and American consumers hangs as a cloud over the proposed transaction.”
Turk was careful to note, however, that “SpaceX does not oppose the transaction,” while urging that “the Commission should carefully evaluate whether Iridium’s conduct is in the public interest.”
SpaceX’s underlying grievance centers on Iridium filing more than 50 petitions over eight months seeking to block or restrict rival satellite deployments, including objections to SpaceX’s next-generation Starlink gateways capable of gigabit-speed service.
The two companies share portions of the 19.4 to 19.6 GHz and 29.1 to 29.3 GHz spectrum bands, with Iridium arguing that several proposed SpaceX ground stations could exceed permissible interference levels “by a wide margin.”
The deal structure amplifies the regulatory risk for Rocket Lab investors because each Iridium share converts into $27 in cash plus a variable number of Rocket Lab shares priced on Rocket Lab’s own 10-day volume-weighted average near closing.
That variable exchange ratio means any Rocket Lab share weakness and regulatory delay reinforce each other, which is why the FCC complaint transmits directly into Rocket Lab’s stock rather than remaining contained within Iridium’s trading.
The transaction carries an enterprise value of $8.1 billion, with former Iridium shareholders expected to own 5% of the combined company, and a shareholder vote on the merger is scheduled for September 24.
Rocket Lab has secured a $3.6 billion bridge facility it may replace with longer-term debt, equity financing, or both before the transaction closes.
Intuitive Machines (NASDAQ: LUNR) fell 5% to $15.32 alongside the broader space complex, giving back a portion of the 31% gain the stock had posted over the prior month heading into Friday’s session.
AST SpaceMobile (NASDAQ: ASTS) dropped 6% to $58.04, moving with sector sentiment rather than any verified company-specific catalyst, with the stock already down 15% year over year through Thursday’s close.
The Procure Space ETF (NASDAQ: UFO) declined 2% to $43.92 as its top holdings weakened in tandem, while the SPDR S&P 500 ETF Trust (NYSEARCA: SPY) edged only 0.3% lower to $768.84, underscoring that the pressure is sector-specific rather than broad-market driven.
On the operational front, Rocket Lab separately disclosed it completed checkouts of the reusable Hungry Hippo fairing for its Neutron rocket, which endured 275,000 pounds of force during qualification testing with control-surface hubs tested beyond 125% of projected flight loads.
CEO Peter Beck has cautioned that “the window for an end-of-year launch is narrowing,” adding another layer of uncertainty for investors already weighing the regulatory risk around the Iridium deal.
Retail sentiment on Rocket Lab remains split, with some traders viewing the FCC development as a genuine threat to the deal and others treating Friday’s weakness as a buying opportunity ahead of the September 24 vote.
