Long suffering fellow Loral shareholders, I've looked into the future and perceive great things ahead:
November 99. Third party reviewers confirm what Geneva Telecom 99 attendees
already know: in addition to being cheaper, lighter and easier to use
than Iridium phones, the G* call quality and reliability is infinitely better. Iridium'
creditors committee starts secret talks with Bernard Schwartz,
under which they would move to liquidate Irid, and hand over it's spectrum licenses
and space assets to G* in return for G* preferred
stock. At the Qrtly conference call BLS advises analysts G* is still on track for 1M
subscribers by y/e 2000 and EPS breakeven by the
4Q00. G* stock reaches 30$/share on the news. Loral falls from 19 to 15 on news
that a primary processor on Hughes built Satmex 5 has
failed. GMH stock is unfazed as Direct TV continues to report record net adds.
February 2000. G* announces the turn on of GWs in Australia, Venezuela, Iceland
and Peru, and the negotiation of JV's to bring service to
India and SE Asia. In addition, Service providers place orders for additional user
terminals, especially Fixed Access Units and car kits. SPs
report good customer reaction to the initial product launch but admit they
underestimated the demand for FAUs and that most people
purchasing a handset require car kits, which are not yet widely available. Qualcomm
commits it's Brazilian manufacturing facility to G*
production to increase capacity and avoid Brazilian tariffs. A license agreement is
announced with Nokia, further increasing production
capacity. Iridium is liquidated by creditors; it's space assets and one Gateway are sold
to G* for preferred stock and renamed Globalstar
Dysprosium. Mr Schwartz announces G* Dysprosium service will be available to those
who can afford it in the polar regions and far out to
sea, while noting that the reassigned Iridium spectrum would permit G* to expand it's
capacity significantly. An order for 24 more G*
spacecraft is placed with Space Systems/Loral. BLS, while noting that he could not
provide subscriber counts suggests that 30K subs have
signed on to the G* service to date, and advises analysts that G* is still on track for
900K subscribers by y/e 2000 and EPS breakeven in early 2001. Craig McCaw starts secret joint talks with ICO creditors and G*. G*
stock reaches 40$/ share while Loral falls from 28 to
22 on news that it admitted reccomending that the Chinese improve their quality
control.
May 2000. G* announces nationwide coverage in China and Brazil and a new GW in
Colombia, providing complete S. American
coverage. Craig McCaw, the ICO creditors and G* announce an agreement
underwhich McCaw would purchase the ICO ground system,
spectrum, satellites, and launch vehicles in progress and transfer them to G* for
convertible preferred stock. The resulting capacity would be
used jointly by Teledesic and Globalstar for voice and data communications. BLS,
while noting that he could not provide subscriber counts,
nevertheless opined that G* was adding subscribers at a rate of 50K per month and
was on track for 800K subscribers by y/e 2000 and
EPS breakeven by the 1Q01. G* stock reaches 50, while Loral falls from 30 to 25 on
news that BLS is once again the Democratic party's
single biggest contributor.
August 2000. G* announces nationwide coverage in Russia, and the start of service in
Turkey, Saudi Arabia and the Gulf States. Joint
ventures are announced that will bring G* service to all of Africa, New Zealand,
Alaska and Hawaii, and an order for ten additional
Gateways is placed with Qualcomm. BLS, while noting that he could not provide
subscriber counts, nevertheless advised that G* was
EBITDA positive as of July 2000 and adding subscribers at a rate of 75K per month
and was on track for 700K subscribers by y/e 2000
and EPS breakeven by the Spring 2001. G* stock reaches 60, while Loral falls from
32 to 27 on news that SS/Ls LS 20.20 program was
being delayed two years and might suffer some "immaterial" cost growth.
November 2000. G* announces start of service from the first of it's Indian Gateways.
BLS, while noting that he could not provide
subscriber counts, advises that G* was cash positive as of October 2000 and was on
track for 600K subscribers by y/e 2000 and EPS
breakeven by the 2Q01. G* stock reaches 80 while Loral falls from 36 to 32 as Al
Gore's reelection coupled with the return of a
Republican congress is seen as guaranteeing continued congressional scrutiny of Loral.
February 2001. G* announces nationwide coverage in India and start of service in
Western and Eastern Africa and Southeast Asia. BLS,
while noting that he could not provide subscriber counts, advises that G* subscriber
count at year end 2000 was nearly 500K, in line with
management's expectations and was growing at 100K per month. Also in line with
management's expectations, EPS b/e is forecast for
Summer 2001. G* stock reaches 110; Loral falls from 40 to 36 on word that the new
congress is planning to investigate alleged technology
transfer to Russia.
May 2001. Following a 2:1 stock split G* trades at 70, as it is finally apparent that G*
subscriber net add rate is on a path to
exceed DISH and Direct TV combined. G* management indicates EPS breakeven,
in accordance with plan, will occur in 3Q01. Loral
sinks from 45 to 40 as BLS is once again disclosed to be the largest individual
contributor to the DNC. G* market cap at this
point is 3X that of parent Loral.
August 2001. In a series of transactions, Bernard Schwartz hands over control of G*
to Craig McCaw which buys out Loral's
FSS and data businesses with newly issued G* stock while spinning off
SpaceSystems/Loral to Boeing. Mr. Schwartz and the
Loral name are retired with much deserved acclaim as G* declares that positive EPS
will be achieved, in accordance with plan, in the
Fall. G* trades at 80 and each holder of Loral is awarded with one G* share per 2
Loral shares.
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