quote.bloomberg.com
Iridium May Get $300 Mln Investment from Craig McCaw, People
Familiar Say
By Josh Fineman
Iridium May Get $300 Mln Investment From McCaw, People Say
Washington, Oct. 1 (Bloomberg) -- Motorola Inc., the biggest
shareholder of Iridium LLC, told creditors of the bankrupt
satellite-telephone network that Craig McCaw may inject as much
as $300 million into the company, said three Iridium creditors
who requested anonymity.
Microsoft Corp. Chairman Bill Gates also may invest an
undetermined amount in Iridium, the creditors said. Gates and
McCaw, a billionaire who started one of the first cellular-phone
companies, are backers of satellite-phone network Teledesic LLC.
Officials of Motorola told creditors of the possible
investments at a meeting in New York City yesterday with
executives of banks that lent $1.5 billion to Iridium, creditors
said. Motorola executives said there's a 50 percent chance Gates
and McCaw would invest after holding negotiations with the
company since July, one of the creditors said.
''It makes sense and is bound to eventually happen,'' C.E.
Unterberg analyst William Kidd said. ''Iridium's troubles are
likely to allow a strategic player to pick those assets at fire-
sale prices.''
Motorola didn't say how large a stake McCaw and Gates would
get if they invest, the creditors said. The meeting was held to
discuss a 60-day waiver of loan payments, they said.
A spokesman for Eagle River Inc., which oversees McCaw's
investments in communications companies, declined to comment.
Microsoft declined to comment. Spokesmen for Washington, D.C.-
based Iridium and Motorola declined to comment on what the
companies said was speculation.
Teledesic's Service
Teledesic said Monday it's considering ways to have its
service begin earlier than a 2004 expected start date.
''We are at the early stages of exploring a variety of
opportunities,'' Bellevue, Washington-based Teledesic spokesman
Roger Nyhus said. ''We have not committed to pursue any
particular opportunity at this point.''
Schaumburg, Illinois-based Motorola, the biggest company
that makes both semiconductors and cell phones, helped found
Iridium to build a global satellite system that would provide
cell-phone reception almost anywhere in the world.
Consumers rejected the company's large, expensive phones,
and after Iridium couldn't agree with creditors on a debt-
repayment plan it filed for bankruptcy protection in August.
Iridium's 14 percent notes due 2005 are being bid for at 11
cents on the dollar, down about 88 percent since February. Shares
of Iridium World Communications Ltd., the publicly traded arm of
Iridium LLC, are halted. They last traded at 3 1/16. |
