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Technology Stocks : IRIQE Iridium -- Ignore unavailable to you. Want to Upgrade?

To: Marty Rubin who wrote (14)	2/5/2000 10:04:00 PM
From: KLP	Respond to of 15

news.cnet.com Group planning $600 million offer for Iridium By Bloomberg News Special to CNET News.com February 5, 2000, 12:20 p.m. PT An investment group led by cellular telephone pioneer Craig McCaw is preparing a $600 million offer for bankrupt satellite-telephone company Iridium, investors familiar with the proposal said. The offer will be made to Iridium's banks. Motorola, which owns about 18 percent of Iridium, plans to pay the lenders about $250 million in cash and $50 million of Iridium's 10 percent convertible notes as part of the proposal, investors said. Iridium's banks would also get 3 percent to 5 percent of the equity in the restructured company. The buyout would eliminate the interest of common shareholders. McCaw's bid for Iridium would follow his $1.2 billion investment in November in rival ICO Global Communications Ltd., which also filed for Chapter 11 bankruptcy protection in August. The founder of the former McCaw Cellular Communications wants to build a satellite network to offer voice, data and Internet services, analysts have said. Iridium representatives declined to comment, while officials at Eagle River Investments, McCaw's private investment company, weren't available. Motorola declined to comment about the proposal. "We have consistently said we would not provide additional funding without the participation of other investors," said Scott Wyman, a Motorola spokesman. Washington-based Iridium filed for bankruptcy protection after failing to attract enough subscribers to its 66-satellite global phone network. The company, which defaulted on $1.55 billion in bank loans, had an estimated 20,000 subscribers as of August. It had expected 600,000 by the end of the year. Iridium's 14 percent notes that are due in 2005 almost doubled in price to $6 per $1,000 bond, investors said. The company received $20 million from investors led by Motorola in December to keep it operating until Feb. 15, the deadline for repaying cash owed to its lenders. McCaw is the largest investor in wireless company Nextel Communications and the founder of Teledesic, a satellite-data network. Shares of Iridium World Communications, which were delisted from the Nasdaq on Nov. 22, rose 94 cents to 5.88 in trading on the "pink sheets," a list published daily that gives information on over-the-counter stocks not listed on the Nasdaq. The stock, which is the publicly traded arm of Iridium LLC, have fallen about 82 percent in the past 12 months. Copyright 2000, Bloomberg L.P. All Rights Reserved.