I assume this means that Qualcomm has approved the deal...
globalstar.com
Court Approves ICO Global Communications Acquisition of Globalstar
ICO to become majority owner of reorganized Globalstar
San Jose, CA, and London U.K. , April 28, 2003 - Globalstar, L.P. and ICO Global Communications (Holdings) Limited announced today they have received court approval for ICO to acquire a majority interest in a reorganized Globalstar.
Late last Friday, the U.S. Bankruptcy Court in Delaware approved the sale of Globalstar's assets to a new company to be controlled by ICO in exchange for an investment of $55 million for which ICO will receive a 54% equity stake in the new operating company. The Court-approved sale supercedes an earlier proposal that had been made by Thermo Capital Partners earlier this month.
"Approximately $12 billion has now been spent for mobile satellite communications and handheld devices. The numerous bankruptcies throughout the industry have been indicative of the risks associated with providing innovative new services and the failure, to date, of mobile satellite service (MSS)," said ICO Chairman Craig O. McCaw. "We believe that the $4 billion spent thus far on Globalstar, however, will result in useful services for governments, corporations and communities around the world. We like the Globalstar system architecture and see this as a turning point for the MSS industry and for Globalstar in particular."
Globalstar provides high-quality, low-latency voice and data services and has become the world's most widely-used handheld satellite phone service. The company will continue its sales and service programs and will explore opportunities to expand its product and service offerings drawing upon assets and resources from the combined companies. Most recently due to demand, Globalstar has expanded its service coverage in the Middle East.
ICO is also currently deploying its own medium earth orbit MSS constellation (at 10,000 kilometers vs. Globalstar's 1,400 kilometer orbit) to provide global voice and data communications. The company has contracted with Boeing and Lockheed/ILS to construct and launch its satellites. The satellites are a composite of the large Hughes/Boeing 601 and 702 satellites modified for mid-earth orbit. Two satellites have already been launched (one of which was destroyed during launch), and a total of eight are required to provide global coverage.
In May of 2000, ICO completed a successful financial restructuring and listed among its shareholders many of the most formidable names in the industry including telecommunications investor Craig McCaw, Deutsche Telecom, Telekom South Africa, Telstra, Korea Telecom, and Agrani Holdings (investment company of Indian satellite businessman Subhash Chandra), together with such notable financial investors as Clayton, Dubilier & Rice, Credit Suisse First Boston and Cascade Investments LLC (the private investment vehicle of Microsoft chairman Bill Gates).
The ICO/Globalstar transaction has been approved by ICO's board of directors, as well as by both Globalstar's general partners' committee and its creditors' committee. Closing of the transaction is subject to Hart Scott Rodino, FCC, and any other appropriate regulatory approvals prior to any license transfers.
Outside of ICO's 54% stake in the newly-formed company, the remaining equity will be distributed to Globalstar's creditors, which include Loral Space & Communications, Qualcomm Incorporated and holders of Globalstar L.P. bonds. In the weeks ahead, Globalstar will file a plan of reorganization with the Bankruptcy Court, and the company expects to complete its Chapter 11 process later this year. |
