***Iridium Gets Extension for Filing Bankruptcy
(January 11)
According to Dow Jones Business News, a U.S. bankruptcy judge has
extended the deadline for Iridium's bankruptcy plan filing to
March 16 and the deadline for acceptances to May 15. The company
had originally requested 90-day extensions - through April 10 for
filing acceptances and June 9 for soliciting them - to allow time
to find the funds for a successful reorganization. Iridium said
it also needed additional time to allow it to complete the plan
negotiation and acceptance process.
But Iridium modified its request in response to objections by VR
Telecommunications GmbH and Vebacom Holdings, as well as the
request of its official committee of unsecured creditors, and
with the consent of the senior secured bank lenders and Motorola,
the venture's largest investor.
VR Telecommunications and Vebacom, whose gateways provide access
to Iridium's satellite system, have also requested a new trial to
consider whether Motorola should have an administrative priority
claim for $20 million in post-petition financing provided to
Iridium. In a Dec. 27 motion, VR Telecommunications and Vebacom
said Motorola was willing to enter into the financing arrangement
without receiving a priority claim. As a result, he said, the
Dec. 16 order approving the financing should be amended to delete
the priority claim, leaving Motorola only a general unsecured
claim.
Iridium filed for bankruptcy Aug. 13, the same day note holders
Canyon Capital Advisors LLC, as fund manager for the Value
Realization Fund L.P.; Magten Partners, and Wall Financial
Investments filed involuntary petitions asserting claims of about
$4.7 million. Iridium filed its petition in Delaware, while the
involuntary cases were filed in New York. All of the cases have
since been transferred to Manhattan.
Iridium is a $5 billion project envisioned to provide wireless
phone service via satellite in areas where there are no phone
systems. But the venture proved impractical and too costly to
carry out. In December Motorola paid off about $743 million worth
of Iridium's bank debt.
The company reported monthly net losses of $111.7 million for
October and $114 million for November.
Wave Issue 2002 1/14/00 Article 12-02