ISTANBUL

US-based satellite communications provider EchoStar announced Monday that it has reached an agreement to sell spectrum licenses worth approximately $17 billion to SpaceX.

The firm said that it will sell all of its AWS-4 and H-block spectrum licenses to SpaceX.

The deal will consist of up to $8.5 billion in cash and up to $8.5 billion in SpaceX stock.

"Additionally, the definitive agreement provides for SpaceX to fund an aggregate of approximately $2 billion of cash interest payments payable on EchoStar debt through November of 2027," EchoStar said in a statement.

With these spectrum licenses, the two firms will enter into a long-term commercial agreement, which will enable EchoStar's Boost Mobile subscribers – through its cloud-native 5G core – to access SpaceX's "next generation" Starlink Direct to Cell service.

"This transaction with SpaceX continues our legacy of putting the customer first as it allows for the combination of AWS-4 and H-block spectrum from EchoStar with the rocket launch and satellite capabilities from SpaceX to realize the direct-to-cell vision in a more innovative, economical and faster way for consumers worldwide," said Hamid Akhavan, EchoStar CEO.

In wireless communication, the spectrum, which refers to the different frequency ranges of radio waves, enables the operation of telephone, internet and satellite services.