Payment is part of new LightSquared restructuring plan
Three years into a bankruptcy filing, would-be wireless network operator LightSquared this week laid out a plan that would repay investor Charles Ergen, chairman of Dish Network, $1.5 billion.
LightSquared raised significant financing for its plan to offer millions of people LTE service using a hybrid terrestrial/satellite network, but filed for bankruptcy protection in 2012 after it was unable to garner clearance from the Federal Communications Commission to use its 1.6 GHz spectrum holdings.
In December 2013, LightSquared was left in the lurch after an investment firm backed out of a tentative agreement to purchase the company. Centerbridge Partners dropped the planned $3.3 billion deal “for economic and non-economic reasons.”
Following the Centerbridge deal disappearing, LightSquared filed a new plan to exit bankruptcy with creditors mustering some $3.75 billion contingent on LightSquared regaining access to some of its 1.6 GHz spectrum holdings. After that, Dish Network came in with a $2.2 billion bid to buy all of LightSquared’s spectrum.
In 2012, the FCC told LightSquared that it could not use its 40 megahertz of spectrum in the 1.6 GHz band to offer mobile service because of potential interference with some GPS equipment operating in nearby bands. That decision prompted LightSquared’s bankruptcy filing.
Reuters reports that Ergen’s lawyer, Rachel Strickland, told a judge the Dish chairman is “still evaluating” LightSquared’s new plan.
“They’ve done what you’ve told them they needed to do,” Judge Shelly Chapman told Strickland.
