February 15, 2012 / 8:06 PM / 6 years ago

Billionaire Falcone: no LightSquared bankruptcy

* Falcone says there is a plan

* Offers no details on what it may be

By Sinead Carew and Svea Herbst-Bayliss

Feb 15 (Reuters) - Hedge fund manager Philip Falcone is ruling out a bankruptcy filing for his telecom startup LightSquared Inc, one day after U.S. regulators said they planned to yank the company’s approval to build a national wireless broadband network.

“It is clearly not on our table,” Falcone said in an email to Reuters on Wednesday when asked if LightSquared, the biggest investment in his Harbinger Capital Partners fund, was considering a bankruptcy filing.

He said there is a plan for dealing with the Federal Communications Commission’s plan to revoke its permission for LightSquared to build out a land-based network, but he declined to offer any details.

Industry analysts and some LightSquared investors say the telecom startup is running short of options with cash draining away and little chance of getting the FCC to change its mind.

In a financial filing last year, LightSquared said it could run out of money by the middle of this year. “A bankruptcy Chapter 11 filing seems inevitable,” said a person with one of the hedge funds that owns some of LightSquared’s more than $1 billion in outstanding debt. The person declined to be named because the situation is still fluid with LightSquared.

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