Gilat to acquire Comtech satellite segment for $157.5m
Gilat Satellite Networks (NASDAQ: GILT) has entered into a definitive agreement to acquire the majority of Comtech Telecommunications Corporation's Satellite and Space Communications segment for $157.5 million in cash, on a cash-free, debt-free basis. The Israel-headquartered satellite technology company said the deal will be funded entirely from its existing balance sheet, which held net cash of approximately $170 million at the end of Q1 2026.
The acquired business generated adjusted revenue of $195.2 million and adjusted EBITDA of $16.8 million for the trailing twelve months ended January 2026. When combined with Gilat's existing operations, the company projects a consolidated annual revenue run-rate exceeding $700 million and adjusted EBITDA of around $80 million. Gilat said the transaction will more than double the revenues of its Defence division.
The deal
Comtech's Satellite and Space Communications segment provides ground infrastructure solutions for GEO, MEO, and LEO constellations, as well as over-the-horizon Troposcatter Beyond Line-of-Sight communications systems and engineering services for satellites, launch vehicles, and manned space programmes. Its customer base includes the US Department of Defense, allied defence agencies, NASA, and commercial satellite operators.
Gilat chief executive Adi Sfadia described the acquisition as a "transformative milestone," adding that it significantly accelerates the company's strategy of expanding into larger, more complex defence and space programmes. He specifically highlighted the addition of RF technologies, space electronics, and Troposcatter BLOS capabilities as complementary to Gilat's existing portfolio.
The transaction has been unanimously approved by both boards. Closing is conditional on regulatory clearance from CFIUS, as well as HSR review by the US Federal Trade Commission and Department of Justice. Gilat expects the deal to close before the end of 2026.
Market context
The satellite ground infrastructure market is undergoing rapid consolidation as demand for resilient, low-latency connectivity from defence customers and commercial operators accelerates the build-out of multi-orbit ground systems. Gilat's existing subsidiaries, including DataPath and Wavestream, already serve US and allied military customers, making the Comtech segment a logical bolt-on rather than a greenfield entry into defence.
The CFIUS review is the most consequential regulatory hurdle. Deals involving Israeli companies acquiring US defence-adjacent technology assets have attracted scrutiny in recent years amid broader concerns about foreign investment in critical communications infrastructure. The scope of the review is likely to cover the segment's work on US government satellite programmes and its manufacturing footprint.
Comtech itself has been restructuring. Separating the Satellite and Space Communications segment follows a period of financial difficulty at the parent company, and the divestiture is intended to allow Comtech to focus on its remaining businesses. For Gilat, the acquisition represents a significant scaling move at a moment when the commercial satellite communications market is crowded with well-capitalised players, including Viasat, Hughes Network Systems, and a growing number of low-Earth orbit ground system vendors.
Investors will be watching for confirmation of the regulatory timetable, early evidence of cross-sell traction across the combined customer base, and any updated guidance on integration costs that could weigh on the projected $80 million EBITDA target in the near term.