Gilat Satellite Networks Ltd. (Nasdaq: GILT; TASE: GILT) today announced that it has entered into a definitive agreement to acquire the majority of the Satellite & Space Communications segment of Comtech Telecommunications Corporation (Nasdaq: CMTL) for $157.5 million in cash. This deal comes six years after Comtech signed an agreement to acquire Gilat for $577 million. The deal collapsed during the covid pandemic.
Today Gilat has a market cap of $1.1 billion and at the end of the first quarter had $171 million in cash. This it can finance the acquisition from its own resources. Gilat also raised debt several months ago in a bond offering and if necessary will issue additional bonds in the future.
Gilat manufactures equipment designed for satellite communications, such as small satellite stations, modems, amplifiers and antennas. Gilat says the deal will accelerate its transformation into a leading provider of critical satellite communications solutions in the defense sector, with the ability to expand rapidly in this fast developing market, and more than double revenue of its defense division. Gilat notes that the deal will create a company annual revenue of more than $700 million and adjusted EBITDA of $80 million, which will strengthen its ability to compete and bid for larger and more complex projects in the defense and space sectors.
Increase defense activity
Gilat CEO Adi Sfadia tells “Globes” that the acquired division produced revenue of about $195 million and adjusted EBITDA of about $17 million in the 12 months to the end of January. “Comtech’s main focus is satellite communications equipment, mainly for the US military,” Sfadia says. “Over 70% of its business is for government institutions and militaries, with an emphasis on the US military. This will make Gilat’s military activity over 40% of revenue, compared with just under 25% today.”
The company expects synergies, which will also include some streamlining, but Sfadia notes Comtech has reduced its workforce in recent years.
Sfadia says Comtech has been in financial distress in recent years, with large debts. “This caused them to stop investing in current assets and just maintain what they have. We believe, based on the examination we have undertaken that there is great potential for accelerated growth here. The defense market is receiving a massive infusion of funds due to the war in Ukraine and the situation in the Middle East, especially in the US where there are huge budgets, a significant portion of which is going to satellites and space. We are seeing budget increases and we will be able to enter projects that we could not enter in the past.”
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According to Sfadia, to enter the US military market a company needs a large US presence and specific approval, and in 2023 Gilat acquired US company DataPath for this purpose. However, Gilat’s Israeli products are only at the beginning of this market, and the acquisition of the division from Comtech should advance Gilat more quickly. “Gilat will have no problem investing in growth, and we will be able to break through,” he says.
Among the activities of the acquired division, Sfadia cites troposphere technology, a communication method that enables the transmission of signals over distances of hundreds of kilometers, independent of direct line of sight. According to him, this is an old technology, but Comtech has made it very accessible, and it is popular in Europe, mainly in the military field, but is also targeting the civilian market, for example in the protection of oil rigs. “There is good potential here for business of $30-40 million with very good profitability,” he says.
Another interesting activity of Comtech, with the growing interest in the space economy in the wake of the huge SpaceX IPO – is that of space components. “Components on satellites and missiles need to undergo a certain approval, and the company knows how to make and sell them. It is part of the Japanese Space Agency’s project, and also works with NASA,” Sfadia notes.
Attractive price
How did you go from a situation of legal proceedings to cancel an acquisition by Comtech to an agreement to acquire a division of Comtech?
“The strategic logic has always existed, these are companies that are quite complementary to each other, with a similar solution that comes through different technological work. Their focus was more military and ours was more civilian, although in recent years we have also been more focused on defense. Comtech made a lot of leveraged buyouts, and Gilat was more conservative. They wanted to buy Gilat, and then the pandemic came, their stock collapsed, Gilat also experienced problems due to Covid. They had trouble raising funds, so they canceled the deal and paid us a fine of $70 million. They had other internal problems of their own, and in recent years they have been in survival mode.
“We have been in contact with them over the years. At one point they decided to sell one of their divisions – the other is related to emergency location services (911 in the US), they hired a banker and we approached them. The process was long because at first they did not agree to compromise on the price. In the end, we agreed on the amount, they wanted much higher amounts.”
According to Sfadia, this is an acquisition at an EBITDA multiple of 9-9.5 over the past 12 months, “Overall there are no other assets of this importance to Gilat, certainly not at this price. The combination of the deal and its price – are very attractive to Gilat,” says Sfadia.
Gilat’s previous major acquisition was of Stellar Blu, a company that provides connectivity solutions for flights. Gilat paid about $98 million for Stella Blu in 2025 and the amount could have increased to about $250 million but the targets that the acquired company set were not realized. However, Sfadia stresses that Gilat’s targets in the acquisition were achieved.
Published by Globes, Israel business news – en.globes.co.il – on June 15, 2026.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2026.
