Falcone Close To Deal With Inmarsat

Aug 13 2010 | 3:46pm ET

By Teri Buhl, Contributor

Harbinger Capital Partners chief Phil Falcone is moving ahead with his 4G wireless plan in a big way. According to people involved in the deal, Falcone is about to execute a cooperative agreement with London-based satellite company Inmarsat. The FCC approved the agreement last month and Falcone has been working to shore up financing.

Rumors have been swirling for over a year that Falcone plans a predatory move to take over the company, but people close to the situation tell FINalternatives that is not what’s happening right now.

What is happening is that Falcone is about to give Inmarsat a huge boost in cash and rent some quality satellite space to advance his plan to bring wireless service to those in remote areas.

People involved in the deal told FINalternatives that the initial payment of $90 million will come from the LightSquared balance sheet—a wireless venture funded by Falcone. LightSquared recently announced it had raised $1.75 billion to create a national wireless network, but analysts predict they still need to raise billions more to make it a reality. Additional payments down the road for Falcone to secure a perpetual lease of 18 MHZ of L band spectrum, which includes a mandatory minimum $100 million a year investment, will come from other capital raised outside of Harbinger’s hedge funds.

A banker who has reviewed the deal and spoke on the condition of anonymity said the agreement could add $1 billion of value to Inmarsat down the road by triggering a stream of payments to the satellite company. Falcone, through his hedge funds, owns 28% of Inmarsat’s stock.

Inmarsat would not comment on the transaction.


In Depth

Humble in Hofstra...One Debate an Election Can Make

Sep 26 2016 | 10:20am ET

Tonight's U.S. Presidential debate, infamously coined the “Humbling in Hofstra...

Lifestyle

Quattrex Sports AG Debuts Soccer-Focused UCITS Fund

Sep 9 2016 | 9:54pm ET

Innovative alternative investment company Quattrex Sports has unveiled a new UCITS...

Guest Contributor

Malik: The Ever-Changing Middle Market and The Entering Class of 2016

Sep 2 2016 | 5:01pm ET

Deal sourcing and origination is only going to get more competitive given current...