Globalstar Telecommunications Limited GSAT Message Board

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Microcap & Penny Stocks : Globalstar Telecommunications Limited GSAT

GSAT 68.47

+0.2%

3:59 PM EST

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To: djane who wrote (5443)	6/29/1999 5:21:00 PM
From: djane	Read Replies (1) of 29987

Post on I* restructuring plans Top>Business and Finance>Stocks>Services>Communications Services>IRID (Iridium World Comm. Ltd.) Your Answer Kaguan by: Tech_Trdr 18223 of 18229 As of Mot last Q filed last month and as of April I believe, Mot owned ~160mm dollars worth of Iridium bonds. IMO they've bought more since then, but that is just my opinion, its a fact they own 160mm. At present they own 18% of the equity in I, Gateway holders and the public stockholders own the rest. Problem with this company is they have no cash flow and debt that has interest due. Only way to pay that interest is to draw the revolver and use that cash, unfortunately the banks will not allow this. This leaves one alternative. A debt restructuring. The plan being offered at the moment is to essentially zero out all the current equity. That means Mot, Gateway holders, and public shareholders. Then reallocate the equity to the debtholders (of which Mot is one). Now since the debt holders realize they need the gateway partners, they allocate them a piece also. No problems with them doing this because they now own the company. All of the current shareholders have NO vote. The reason for this is to lesson the debt on the company so I can afford to pay what it owes. In exchange for the equity they received, they debt holders will allow their debt to 1.) be haircut, meaning they will accept less than 100 cents on the dollar at maturity, 2.) they will turn the notes into either PIKs or zero coupon bonds. This will alleviate the cash flow problem as I* will no longer have to come up with cash out of current cash flow to pay interest on their debt. Thats it in a nutshell. I'll be happy to answer any questions you may have. Good Luck. Trader Posted: 06/29/1999 04:36 pm EDT as a reply to: Msg 18217 by kaguan

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