NextWave Chief Says Financing Almost Complete
Thursday August 16 5:43 PM ET
By Jeremy Pelofsky
NEW YORK (Reuters) - NextWave Telecom Inc. has received commitments for most of the financing for its plan to emerge from bankruptcy, the company's chairman said on Thursday as he went to Wall Street to detail the company's blueprint to build a mobile, digital data wireless network.
The company is almost done signing up buyers for $2.5 billion to $3 billion in convertible preferred stock and will unveil, possibly as early as Friday, deals for $2.5 billion in debt financing, NextWave Chairman and Chief Executive Officer Allen Salmasi said.
``We're very close, we have the bulk of (preferred stock) either fully subscribed or being negotiated right now,'' Salmasi said in an interview after making a presentation to Wall Street analysts.
``We are finishing those (debt) arrangements and...we're hoping as early as tomorrow or early next week'' to announce the agreements, he said, but declined to identify the parties involved.
Earlier on Thursday, wireless technology giant Qualcomm Inc. said it would make a $300 million investment in NextWave and would aid the company deploy its high-speed network using Qualcomm's CDMA2000 technology.
NextWave (NXLC.PK) plans to launch its data network in dozens of markets in December and expand to 95 markets by April and add voice services by the end of 2002, he said during the presentation.
However, the plans for launching the network hinge on winning a court battle against the U.S. government, which tried to repossess wireless licenses after the company failed to pay for them on time.
An appeals court ruled the government violated bankruptcy laws when it took back the licenses, and ordered they be handed back to NextWave. But the Federal Communications Commission (news - web sites) has asked the court to delay that ruling until it appeals to the U.S. Supreme Court (news - web sites). FIGHT FOR SPECTRUM
Later on Thursday, NextWave will file its brief opposing the government's request. A ruling could come at any time. The FCC (news - web sites) in January re-sold the airwaves to other wireless carriers hungry to get their hands on the spectrum to expand and improve wireless telephone service.
Some of those carriers, including Verizon Wireless (NYSE:VZ - news) (VOD.L), VoiceStream Wireless (DTEGn.DE) and Cingular Wireless (NYSE:BLS - news) (NYSE:SBC - news), have offered billions for NextWave to relinquish its claim to the licenses.
If the Supreme Court agreed to hear the case, oral arguments would likely take place early next year with a decision rendered by June 2002. That would likely leave the spectrum fallow for at least 9 months.
On proposals by the winners in the January auction for NextWave to take money to walk away from the licenses or sell parts, Salmasi said NextWave is ``strictly in a listening mode at this point'' but they call from ``time to time'' to talk about proposals on the table or make new ones.
During the presentation, Salmasi said that while no settlement proposals have been ``turned down'' by NextWave's shareholders, they were inclined to back the plan to emerge from bankruptcy.
One analyst at the presentation said ``I think they're going to build'' out the network while another said ``no surprises'' came out of the meeting.
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