*ICO Global Asks Bondholders for Extension on Interest Payment
London, Aug. 20 (Bloomberg) -- ICO Global Communications Ltd., which is trying to build the world's
third global satellite- telephone network, is asking its bondholders for an extension on an interest
payment due Sept. 1 as the company struggles to secure financing.
ICO is seeking waivers from it bondholders to defer paying $43 million in interest until Sept. 30 and to
waive their rights to sue the company, according to a filing with the Securities and Exchange
Commission. ICO owed about $570 million in debt to its bondholders as of a year ago.
Last week, ICO failed to get $600 million in financing commitments from an unidentified investor group
and said it's considering another proposal from the group for a smaller investment. ICO Global has
stumbled in attempts to raise capital for its $4.6 billion system. It failed to get $500 million it sought from
a public rights offering that was extended twice.
```When push comes to shove, especially after
considering what's happened to Iridium bondholders, ICO bondholders might want to consider pulling
the plug,' said Phelps Hoyt, a high- yield analyst at KDP Investment Advisors. ``Their position might not
be as good once the company receives senior bank financing.'
ICO presented its proposal to some bondholders at a meeting in New York City on Thursday, ICO
spokesman Joe Tedino said.
Satellite analysts have attributed ICO Global's financing problems to the woes of rival Iridium LLC.
Iridium, the first to offer satellite-telephone service, filed for Chapter 11 bankruptcy protection last week.
Under the latest proposal, ICO is seeking a minimum of $500 million from unidentified investors and
$400 million in contract deferral from suppliers under major contracts, the filing said. ``Because of the
need to obtain government, and/or other necessary approvals, the company is separately seeking
bondholder waivers of their rights, through September 30, 1999, to accelerate the state maturity of the
Notes as a result of the Company's failure to pay interest on the Notes that was due on August 2,
1999,' the company wrote in the filing.
London-based ICO Global also will be competing with Globalstar Telecommunications Ltd. in the
satellite- communications industry.
ICO Global has said it needs to raise about $1.6 billion, including the money raised from the strategic
investors, to pay for daily operations before starting the service in the fourth quarter of 2000.
Shares of London-based ICO fell 3/8 to 5 1/8. ICO bonds fell about 3 points to 35.
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