Falcone mulls voluntary bankruptcy for LightSquared [Telecom]

Full article here:

Excerpts follow:

Hedge fund manager Philip Falcone said in an interview on Wednesday he is "seriously considering" filing a voluntary bankruptcy for LightSquared, the struggling telecom startup in which his Harbinger Capital Partners is the majority owner.

Falcone said a bankruptcy is one of several options he is considering as he tries to find a way to salvage the company, which reported a $427 million net loss during the first nine months of 2011, and keep its creditors at bay.

He said a bankruptcy would allow the company time to find a way to deal with communications interference issues that have arisen with the planned buildout of a nationwide wireless broadband network.

Falcone said a bankruptcy would not necessarily wipe out the equity holders of LightSquared because the spectrum it owns retains value.

[...]

It wasn't too long ago that Falcone was the toast of hedge fund row after his fund soared to $26 billion in assets after making a wildly successful bet on the collapse of the housing market. Almost overnight, Falcone went from being a relatively unknown distressed debt trader to a billionaire who was buying one of the most expensive townhouses in Manhattan.

[...]

Falcone's announcement that he is considering a voluntary bankruptcy is a reversal of a stance he took in February after the Federal Communications Commission withdrew a conditional waiver that allowed LightSquared to begin building out its mobile network.

The FCC revoked the waiver after tests revealed that LightSquared's planned network would interfere with crucial satellite systems used for critical services such as aviation safety and the U.S. Department of Defense. The FCC action also came after bitter protests from a trade group representing companies that rely on Global Positioning Systems, which operate in a spectrum close to LightSquared.

In the wake of the FCC decision, LightSquared's main business partner, Sprint, canceled a deal to help it build out the network.

[...]
Reply to
Thad Floryan
Loading thread data ...

Cabling-Design.com Forums website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.