Post-acquisition, Gogo expects its net leverage to be around four times, with intentions to reduce this to a target range of 2.5 to 3.5 times within two years.

The deal is strategically aimed at strengthening Gogo's position against increasing competition from SpaceX's Starlink in the inflight connectivity market for business jets.

Analysts suggest that the acquisition is likely to receive regulatory approval due to the competitive threat posed by Starlink, which has gained significant traction in the market.

The competitive landscape is further highlighted by Air France's recent announcement to equip its entire fleet with Starlink's low Earth orbit broadband service.

To finance the acquisition, Gogo plans to utilize its cash reserves along with $275 million in new debt.

The integration of Gogo and Satcom Direct is expected to provide high-performance GEO-LEO satellite solutions and improved customer support for the global heavy jet segment.

Satcom Direct generates a significant portion of its revenue from military and government contracts, and has ordered LEO ESA terminals from Gilat Satellite Networks.

Satcom Direct is projected to generate approximately $485 million in revenue in 2024, contributing to the overall growth of the combined entity.

Gogo Inc. has announced its acquisition of Satcom Direct for $375 million in cash and five million shares, with potential performance-based payments of up to $225 million over the next four years.

This acquisition is set to expand Gogo's market reach to include 14,000 business aircraft outside North America, allowing the company to offer integrated multi-band services.

Together, Gogo and Satcom Direct provide Wi-Fi connectivity to approximately 8,200 of the 9,200 business jets equipped with such services, representing nearly 90% of the market.

Both Gogo and Satcom Direct utilize air-to-ground networks and leased capacity from geostationary orbit satellites, enhancing their service offerings.