Lynk Global’s SPAC merger on the rocks

TAMPA, Fla. — Slam Corp, the shell company founded by former MLB player Alex Rodriguez, is suing Lynk Global to stop the direct-to-smartphone satellite operator from walking away from their long-delayed merger.

Investors in Rodriguez’s special purpose acquisition company recently approved the SPAC’s proposal to extend its deadline for closing the merger to as late as Dec. 25, even though Lynk says the deal agreement includes a June 30 termination date.

The civil complaint Slam filed seeks to block any attempt by Lynk to terminate the deal, alleging the satellite venture breached the agreement and failed to meet its obligation to operate in good faith.

Lynk dismissed the claims as baseless in a June 24 news release, stating it will vigorously defend against the lawsuit and file counterclaims.

Paths diverge

The companies had aimed to complete their merger last year after finalizing the agreement in February 2024, three years after Slam raised $575 million from listing its shares on the stock exchange to pursue a business combination.

However, Slam reported just $23.7 million in its trust account as of June 5, following a wave of investor redemptions and delays to close the transaction. The companies had also outlined a planned $110 million Private Investment in Public Equity (PIPE), where institutional investors typically purchase shares below market value to support the deal.

Meanwhile, a February regulatory filing showed Lynk had raised $85 million toward a $215 million Series B funding round. Backers include established satellite operators SES and Intelsat, which are also in the process of merging with one another.

In November, former Intelsat executive Ramu Potarazu was appointed CEO of Lynk.

Falls Church, Virginia-based Lynk is seeking funds to grow its satellite constellation and improve capabilities after deploying five satellites in low Earth orbit. 

The constellation is currently capable of providing intermittent texting and low-bandwidth services for unmodified smartphones through telco partnerships in countries including the Solomon Islands, Cook Islands and Palau.

Lynk’s move to distance itself from the merger also comes amid growing momentum in the fledgling direct-to-smartphone market, which aims to help terrestrial telecom partners keep subscribers connected outside cell tower coverage.

Rival AST SpaceMobile is preparing to ramp up satellite deployments ahead of beta service later this year, while SpaceX plans to begin supporting image and audio messaging via its Starlink satellites in October, in addition to basic texting.