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MINNEAPOLIS, Minn., June 15 (Reuters) - Wireless communications provider and semiconductor maker Motorola Inc. (NYSE:MOT - news) said Tuesday it will make a decision in July regarding its commitment to
satellite communications company Iridium World Communications Ltd. (Nasdaq:IRID - news).
''In July, we'll know what the banks are going to do, and we'll know whether we're going to invest more money or not,'' Fred Tucker, deputy to the chief executive officer at Motorola, told Reuters at the U.S.
Bancorp Piper Jaffray investment conference here.
Motorola owns an 18 percent stake in Iridium and has guaranteed a large portion of the company's more than $800 million debt.
Tucker, Motorola executive vice president, said that Motorola officials were meeting on Tuesday with Iridium to review the troubled
company's new marketing plan for its satellite mobile telephones.
''The technology works right well,'' Tucker said. ''The real issue is loading the system up and selling it.''
Iridium initially planned to sell the satellite phones to high-end businessmen, but sales fell well short of the company's goals. Now Iridium plans to target their product at governments, oil companies and the boating industry, Tucker said.
Earlier this month, Iridium's banks said it would extend the company's financing through the end of June.
The Washington-based company has struggled to meet its financial and subscriber targets required as part of its $800 million credit facility.
Iridium's lenders have given the company until June 30 to increase its subscriber base to 27,000. The company had 10,300 at the end of March.
In a filing with the U.S. Securities and Exchange Commission in mid-May Motorola detailed its financial commitments to iridium, which total $1.66 billion. Of that, Iridium has drawn down $882 million. In the filing, Motorola said that if Iridium defaults, it would have a ''material negative impact'' on Motorola's financial results.
Shares of Motorola were trading up 3-5/16 to 89-5/16 while shares of Iridium added 1-5/16 to 6-11/16 in mid-afternoon trading.
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