Philip Falcone has reportedly rejected suggestions that LightSquared is considering a bankruptcy filing, after the FCC rejected the venture’s plans to roll out a wireless broadband network using satellite and terrestrial technology.
Reuters reported…
Philip Falcone has reportedly rejected suggestions that LightSquared is considering a bankruptcy filing, after the FCC rejected the venture’s plans to roll out a wireless broadband network using satellite and terrestrial technology.
Reuters reported that Falcone, founder of New York hedge fund Harbinger Capital Partners, had said that a LightSquared bankruptcy filing was “clearly not on our table”.
Media reports have suggested that LightSquared has hired investment bank Moelis & Company as a restructuring adviser. Moelis declined to comment.
LightSquared is also reportedly due to make a US$56m payment to British MSS operator Inmarsat shortly, as part of the spectrum leasing agreement between the companies.
Meanwhile, Dow Jones cited people familiar with LightSquared’s plans as saying that Falcone is seeking to swap spectrum currently held by LightSquared for airwaves owned by the US Department of Defense.
Citing one person familiar with the matter, the newswire reported that Harbinger has organised a conference call with investors at 10am Eastern time on Friday.
Harbinger is the main financial backer of LightSquared, which has seen its ambitious plans to provide mobile broadband to 260m Americans by 2015 collapse due to GPS interference problems.
Harbinger and LightSquared were not immediately available for comments.
FCC asks for comments
Meanwhile, the FCC is now seeking comments on the analysis of LightSquared’s interference problems that was submitted earlier in the week by the NTIA, the president’s adviser on telecoms and technology policy.
The NTIA’s analysis was summarised by Lawrence Strickling, an assistant secretary at the Department of Commerce, in a letter to FCC Chairman Julius Genachowski.
Writing on behalf of the NTIA, Strickling said that “we conclude that LightSquared’s proposed mobile broadband network will impact GPS services and that there is no practical way to mitigate the potential interference at this time”.
The deadline for comments on the NTIA’s report is 1 March.
In a statement yesterday, the FCC said that it planned to withdraw the conditional approval it gave LightSquared in January 2011, which would have allowed the venture to deploy its network, had it been able to resolve the interference issue.
LightSquared said that “the FCC has harmed not only LightSquared, but also the American public by making it impossible to build out a system that would meet public policy goals of successive administrations”.
The venture added that it had already spent almost US$4bn on the network project.
