LightSquared Foresees Competing Plans for ReorganizationTiffany Kary
Philip A. Falcone’s bankrupt LightSquared Inc., said it foresees competing proposals to reorganize its assets and asked the court for a deadline of Sept. 4 to take proposals.
The broadband network services provider, also facing a $2 billion cash offer for its assets from an entity owned by Dish Network Corp. Chairman Charlie Ergen, lost the exclusive right to control its reorganization July 15. It hasn’t been able to get creditor support for a reorganization timeline and is proposing a streamlined process, it said today in court papers.
LightSquared asked the U.S. Bankruptcy Court in New York for permission to have outlines of all competing plans filed by Sept. 4, with a Dec. 16 confirmation hearing to approve the best offer.
“As LightSquared continues to work towards a successful resolution of its Chapter 11 cases, it anticipates the submission of multiple competing plans of reorganization and potential litigation” arising from them, company lawyers wrote.
The company earlier this week delayed a hearing on control of its assets without disclosing specifics of a dispute with Ergen’s entity.
Falcone’s Harbinger Capital Partners LLC is “trying desperately” to keep ownership of LightSquared in the face of debt-buying by Ergen’s SP Special Opportunities LLC fund, at the expense of creditors, lenders have said. The Ergen fund joined the lender group on June 13.
The lenders also have said LightSquared hasn’t acted on a $2 billion bid from Ergen’s L-Band Acquisition Corp. and can’t get regulatory approval or enough financing to exit bankruptcy on its own.
LightSquared, based in Reston, Virginia, filed for bankruptcy in May 2012, listing assets of $4.48 billion and debt of $2.29 billion.
The case is In re LightSquared Inc., 12-bk-12080, U.S. Bankruptcy Court, Southern District of New York (Manhattan).