mot.com
Well, it looks as though the IPO for 8% of Iridium LLC is being sold at no premium! So you can get in on the ground floor of Iridium and hope it doesn't go down to the basement instead of into orbit. Globalstar at $32 seems a better bet even at the discounted Iridium $20 IPO price though this analysis is a bit rough around the edges!
Some subscriber capacity would be interesting.
Motorola report at 31 Dec 96
--------------------------------------------------------------------------------------------------------
Development of the IRIDIUMr global communications system continued on schedule, as Motorola met all contractual milestones during 1996. Initial satellite launches, which were originally scheduled for January 1997, have been delayed to the second quarter of 1997.
Iridium LLC, a Delaware Limited Liability Company, negotiated a $750 million credit facility, which Motorola guaranteed, in 1996 providing it with funding until May 1997. At that time, Iridium LLC will require further funding to continue to make contractual payments to Motorola. As of December 31, 1996, $512 million of the credit facility had been drawn. Motorola is negotiating to increase its guarantee of Iridium LLC bank financing, and Iridium LLC is negotiating to increase its credit facility. These negotiations are expected to be completed in the first half of 1997. There can be no assurances as to the outcome of these negotiations.
In addition, Iridium LLC is expected to require other financial support from various sources in order to complete the global communications system, which is expected to take place over the next two years. There also can be no assurances that Motorola or any other person will provide funding or financial support. At the end of 1996, Motorola was a 24% equity owner and is the largest investor in Iridium LLC.
A failure of Iridium LLC to obtain additional funding would materially adversely affect Motorola's investment in Iridium LLC, in several Iridium Gateway companies and in ancillary products. The Company's investment in Iridium LLC and in several Iridium Gateway companies, which is approximately $537 million, is included in the Consolidated Balance Sheet category "Other Assets."
The Company has executed three contracts with Iridium LLC for the construction and operation of the global communications system, providing for approximately $6.5 billion in payments to Motorola over a 10-year period which began in 1993. The Company has in turn entered into significant subcontracts for portions of the system, for which it will generally remain obligated even if Iridium LLC is unable to satisfy the terms of the contracts with the Company, including funding.
----------------------------------------------------------------------------------------------------------- |
