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Technology Stocks : Leap Wireless International (LWIN)
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To: A.L. Reagan who wrote (2337)7/2/2002 8:54:23 PM
From: pcstel  Read Replies (1) of 2737
 
Dontcha think Lucy and Norty would take a haircut to get cash in the bank?

They sure did in Brasil with Vesper! I think it was 20 cents on the dollar.

What kind of Haircut are you talking about? I think if you were talking about 20 to 30 cents on the dollar, then I think LWIN might buy the debt back themselves, if the Vendors agreed. I mean they have the cash to do a vulture type deal? Don't they? I would guess that maybe 40% or Lucents Vendor debt has already been sold. Rumors are much of it sold in the .50 to .60 range over the last year or so.

Trade 700 million (probably what LU directly holds) in LU debt for 210 million cash (30 cents on the dollar), Which is much higher than the market is paying for this debt. LWIN's debt drops from 1.8 Billion to 1.1 Billion. LWIN controls the outstanding LU debt, and drops the covenants. LWIN cash and equivs. goes from 270 M, to 35 M after the deal and EBITDA loss for Q2. LWIN has 125 million QCOM facility, and hopefully 35 million coming from Telefonica. Available cash and credit of 190 Million after the QCOM facility and Pegaso.

LWIN debt repayment in CY03 on the outstanding non LWIN owned Lucent Facility drops to 17 million a quarter.

I am sure they could tap the QCOM facility for 60 million if NT wanted in on the deal for their ~200 million. QCOM's interest rate is higher. But for 30 cents on the dollar.. Who cares.

I think ERICY is a little more relaxed with the business.

PCSTEL
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