LightSquared bankruptcy exit plan backed by Fortress
With financing from Fortress Investment Group and other backers, LightSquared is intending a new bankruptcy exit plan, as the U. S. wireless communications company seeks to avoid a sale to highest bidder Dish Network Corp.
Court documents filed late Tuesday show that LightSquared would obtain $2.75 billion in fresh loans and at least $1.25 billion in equity investment from the private equity firms Fortress and Melody Capital Advisors LLC, JPMorgan Chase & Co and Harbinger Capital Partners.
Billionaire Philip Falcone's hedge fund, Harbinger, is LightSquared's controlling shareholder.
The participation of the investment firm highlights the stern competition for wireless spectrum, or broadband frequencies, in the United States.
The plan, filed in Manhattan's U. S. Bankruptcy Court, replaces one based on an auction of the company's assets earlier this year. LightSquared scrapped that sale after Dish emerged as the only qualified bidder, with a $2.2 billion offer and terms that LightSquared found unappealing.
Charlie Ergen, Dish Chairman has been acquiring billions of dollars worth in wireless airwaves to branch out his satellite television business, and has been fighting Falcone for control over the company. On the other hand, Falcone had sued Ergen for illegally trying to take control of LightSquared, alleging that Ergen had made improper trades and violated a key credit agreement by buying up about $1 billion of LightSquared's debt in secret.
New Zealand News
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