Elon Musk, Tesla Motors CEO, tells the Reuters Global Tech Summit that he'll talk to politicians who back local car dealers trying to keep Tesla from selling directly to consumers. Video
LightSquared bankruptcy seen imminent: sources
(Reuters) - LightSquared Inc MOSAV.UL, the startup telecommunications company bankrolled by hedge fund manager Philip Falcone, is expected to file for bankruptcy protection in the next hours, sources familiar with the matter said.
Falcone has until Monday at 5 p.m. EDT (2100 GMT) to reach an agreement or face a default on a $1.6 billion loan, sources said. While the parties still have a few hours left to negotiate, the sources suggested that a last minute deal is highly unlikely and that the filing is imminent.
A representative for Falcone was not available for comment.
Creditors have been negotiating to restructure LightSquared's 96 percent ownership by Falcone's Harbinger Capital Partners.
"The bondholders are asking for conditions they know Harbinger and Phil cannot agree to," a source close to the situation said on Sunday.
Falcone, once one of the hedge fund industry's biggest stars, had already been given a reprieve twice before when debt holders extended the original April 30 deadline two times.
LightSquared has been fighting for its life since February when the U.S. Federal Communications Commission said it would revoke permission provisionally granted to LightSquared to build a high-speed wireless network. Tests found that LightSquared's systems could interfere with the Global Positioning System, critical to the military, commercial aviation, and many other industries including agriculture.
Falcone, who once managed around $26 billion for wealthy investors, has faced off against other prominent hedge fund managers who had bought the company's debt. LightSquared creditors have included hedge fund manager David Tepper, billionaire investor Carl Icahn and hedge funds including Fortress Investment Group (FIG.N), Knighthead Capital Management, Redwood Capital Management and investment firm Capital Research and Management Co.
Icahn recently sold his $250 million position in the company for a profit, according to sources.
Law firm Milbank, Tweed, Hadley, & McCloy is the debtor counsel and Lazard is the restructuring adviser.
(Reporting By Svea Herbst-Bayliss, Matthew Goldstein, and Sinead Carew; Editing by Tim Dobbyn)
- Tweet this
- Share this
- Digg this