LightSquared, Sprint Put $13.5 Billion Deal On Hold

Jan 6 2012 | 9:10am ET

Just days after winning a critical extension from its most important partner and customer, Harbinger Capital Management's wireless Internet venture has won a further reprieve from Sprint Nextel Corp.

Sprint CEO Dan Hesse said yesterday that his company and LightSquared have agreed to put their $13.5 billion deal on hold until the latter wins the needed regulatory approvals. LightSquared needs the Federal Communications Commission to sign off on its plans before it can deploy its network, which Sprint was to build, but has run into stiff opposition from global positioning system users and manufacturers, who warn that LightSquared could interfere with such devices.

Hesse said that he still hoped that LightSquared, into which Harbinger founder Philip Falcone has poured the majority of his hedge fund's assets, would win the necessary approvals.

"The companies have agreed to realigning our deployment timeline to coincide with potential FCC actions," a Sprint spokesman said. "Both companies believe it is prudent to pull back on expenses."

A recent internal report indicates that LightSquared is running out of money. The company has already paid Sprint $290 million.


In Depth

GSAM's Papagiannis: Liquid Alternatives For The Long Run

Apr 21 2017 | 8:44pm ET

Interest in liquid alternatives cooled a bit last year amid a broad shift in investor...

Lifestyle

Aston Martin Returns To Debt Market As DB11 Drives Turnaround

Mar 31 2017 | 5:21pm ET

James Bond’s preferred carmaker is returning to the public debt markets for the...

Guest Contributor

Debunking Conventional Investment Wisdom (Part II)

Apr 17 2017 | 5:56pm ET

The alternative investment industry is currently replete with buzzwords around data...

 

From the current issue of