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Microcap & Penny Stocks : Globalstar Telecommunications Limited GSAT -- Ignore unavailable to you. Want to Upgrade?

To: Dragonfly who wrote (1462)	7/18/1998 11:35:00 PM
From: Waitstill	Read Replies (2) \| Respond to of 29987

All: Globalstar India in for shake-out as Hyundai exits Date: 19-07-1998 :: Pg: 01 :: Col: e Anita Mani NEW DELHI, July 18 THE existing partnership of Hyundai, Crompton Greaves and PCL in Globalstar India Satellite Services (GISS) is likely to be dissolved and replaced with a new arrangement, official sources involved with the process said. This follows Hyundai's decision to exit from the Globalstar service provider business worldwide, they said. Globalstar is a Global Mobile Personal Communications System (GMPCS) service, which is a satellite-based mobile telephone service. Subscribers to the service, which will be available globally, will use handsets similar to GSM phones though the service can also be used through fixed wireless terminals. The Globalstar service is expected to be launched in the first half of 1999. In India, the Department of Telecommunications (DoT) has formulated a GMPCS policy which is currently being studied by the regulator. Officials from Globalstar L.P. were in the country last week to meet the Indian partners of GISS as well as the Government. They are understood to have indicated to the Telecom Secretary, Mr. A.V. Gokak, that all pending applications submitted by the current partnership, including one to the Foreign Investment Promotion Board (FIPB) will be withdrawn. These will be replaced by fresh applications, once the new structure of the company is in shape, the officials said. Hyundai is a member of the Globalstar primary partnership which includes companies such as AirTouch Communications, France Telecom, Loral Space and Communications Ltd, Qualcomm and Vodafone. Earlier this year, Hyundai, which had an approximately 6 per cent equity stake in the primary partnership, sold around 85 per cent of this stake to investors, including Mr. George Soros. Hyundai further communicated to Globalstar L.P. that it would like to terminate commitments to offer the Globalstar service in around 11 countries, including Pakistan, India, Thailand and Finland. The officials said Globalstar is extremely concerned about the fate of the Indian operations, given the potential market as well as the fact that three Globalstar gateways are also to be located in India. Hyundai has already communicated to Globalstar L.P. that it wished to cancel orders for gateways for certain countries in the Asian region. In India, the GISS equity structure is as follows: Crompton Greaves (34 per cent), PCL (17 per cent) and Hyundai (49 per cent). With respect to India, sources said Globalstar L.P. has taken the view that since it was Hyundai, which had the rights to offer services in these 11 countries, that forged the partnership, Globalstar L.P has no commitment towards the Indian companies. Officials from Globalstar L.P. held negotiations with Crompton Greaves and Pertech Computers last week. The Indian companies are understood to have told them that since they had invested time and money in the venture they should be considered for the new partnership that will offer services in India. Otherwise, the companies are understood to have indicated that they would like to be compensated for investments made so far. The issue could land up in court with Crompton Greaves and PCL telling Globalstar L.P. that it may obtain stay orders from the courts to sort out the issue before any new partnership becomes operational. Globalstar L.P., in turn, is filing caveats in the courts so that no ex parte orders can be issued. Globalstar L.P is, however, confident that a new partnership will be forged to offer the service, following the exit of Hyundai.