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Technology Stocks : Leap Wireless International (LWIN) -- Ignore unavailable to you. Want to Upgrade?

To: A.L. Reagan who wrote (2337)	7/2/2002 8:54:23 PM
From: pcstel	Read Replies (1) \| Respond to 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

To: A.L. Reagan who wrote (2337)	7/3/2002 1:18:04 AM
From: Maurice Winn	Read Replies (1) \| Respond to of 2737

As PCSTEL says, they accepted a major reduction in debt [80% wiped off] contingent on QUALCOMM adding a lot more money to Vesper, which provided security to the remaining 20% and should enable Vesper to make money and pay interest and principal on the remaining debt. Leap isn't in such dire straits [yet]. So I don't see why any write off would be acceptable to vendor creditors at present. I guess the vendor creditors will let Leap continue, [because Leap's assets are really only of value where they are installed and as a going concern], collect their interest payments and hope that Leap gets some of that EBITDA stuff in sufficient quantity to pay the itda and buy more equipment to expand the network and defeat competitors. If I was a vendor creditor, I wouldn't be in a hurry to cause trading problems for Leap. But neither would I be in a hurry to accept that I should write off some of my supplies to Leap. There's money in the bank, more is rolling in, sales growth is fine, prospects further down the technological highway look good for Leap. But that's not to say that other creditors or shareholders have got anything of value left. As you say, at some price, Lucent and Nortel would take a haircut to get cash in the bank, to keep other aspects of their business on track. But I don't think they'd accept anywhere near a Vesper-style 80% reduction at present. However, there are obviously going to be some great bargains in the telecosm as assets go on the block and minute and megabyte prices drop to clear the market and boost demand. As you say, cash is a useful thing to have right now instead of losses, dodgy accounting and EBITDA but no EBATDA. Mqurice