Noah Samara has made a last ditch attempt to buy the assets of WorldSpace, the satellite radio provider that he founded and managed and which has spent the past twenty months in Chapter 11 bankruptcy protection.
Judge Peter Walsh from the US Bankruptcy…
Noah Samara has made a last ditch attempt to buy the assets of WorldSpace, the satellite radio provider that he founded and managed and which has spent the past twenty months in Chapter 11 bankruptcy protection.
Judge Peter Walsh from the US Bankruptcy Court for the District of Delaware is currently weighing up an offer of approximately US$5.5m from Yazmi USA, an investment vehicle owned and controlled by Samara, to acquire WorldSpace’s assets, which include the AsiaStar and AfriStar satellites, a satellite in storage, the related operational ground equipment and its regulatory licences.
The deadline for objections to the sale is May 28, with the sale hearing scheduled for June 1.
The offer was prompted by the bankruptcy court’s decision to grant a motion on March 24 to deorbit the AsiaStar and AfriStar. The emergency motion had been filed by WorldSpace after Liberty Global had abruptly terminated its interest in purchasing the satellite radio provider’s assets following a period of due diligence.
Back in September 2009, Liberty, via its subsidiary Liberty Satellite Radio, purchased the claims of the previous WorldSpace lenders under both the DIP financing and the secured notes agreements and was seemingly in pole position to buy up the WorldSpace assets, which it could have merged with its 40% stake in Sirius XM.
However, the motion to deorbit the spacecraft following Liberty’s exit seemingly spurred previous interested bidders into action. The court report states: “The deorbit motion made parties aware that the debtors (WorldSpace) might prefer a sale to a de-orbiting. After the Court granted the deorbit motion, a number of parties that had previously considered purchasing the debtors’ assets again approached the debtors about an acquisition.
“After considering various offers – some of which included funding for the debtors’ operations – from numerous parties, the debtors narrowed the list of possible buyers down to two. On or about May 1, the debtors asked the two potential buyers to submit their best offers by May 4. Each potential buyer timely submitted a written offer. On May 5, the debtors’ board met to review the bids, and determined that the Yazmi bid was superior.
“The benefits of the Yazmi bid include (a) a higher purchase price, (b) payment of the purchase price three business days after entry of the Sale Order (i.e., prior to regulatory approval), (c) funding for certain reasonable operating expenses, including the provision of funding prior to Court approval of the APA (asset purchase agreement) and (d) Yazmi demonstrating that it had, in a U. bank account, immediately available funds to pay the purchase price. In addition, Yazmi has made US$100,000 available to the debtors to consummate a de-orbiting of the satellites should Yazmi fail to close under the APA.”
Shearman & Sterling and Pachulski Stang Ziehl & Jones are counsel to WorldSpace on the bankruptcy case. Shearman & Howard are counsel to the debtors’ secured lenders, while Arent Fox and Elliot Greenleaf & Siedzikowski are advising the unsecured lenders.
