NEW YORK (Bloomberg) — A unit of Greenhill & Co., the merger advisory firm founded by chairman Robert Greenhill, agreed to buy Iridium Holdings LLC in a deal that values the satellite-phone service provider at about $591 million.

Greenhill will invest $22.9 million in Iridium and use $324 million to pay off debt of about $131 million, pay transaction expenses, and provide funds for Iridium's expenditure, Greenhill said yesterday.

Iridium shareholders will get about $77 million in cash, and about 36 million shares in the company, which will be renamed Iridium Communications Inc.

Greenhill investors will own about 55 percent of Iridium's common shares and Iridium's shareholders will own 42 percent, the company said. The transaction is predicted to close in the first part of 2009.

Robert Niehaus, Greenhill's senior vice president, will become chairman of the combined company and Iridium's Matthew Desch will remain as chief executive officer.

Iridium, formerly based in Bermuda, says it is the only company with a satellite network that covers the entire globe without service gaps, including the poles, oceans and airways.