Centerbridge Tops Dish Offer For Harbinger Wireless Co.

Dec 12 2013 | 2:11pm ET

Harbinger Capital Management's Phillip Falcone may get to build his wireless Internet network after all.

Just before a bankruptcy auction that seemed poised to sell Harbinger's LightSquared to Dish Network, two of the hedge fund's fellow alternative investments players stepped in to offer more for the company, into which Falcone has poured billions in investor capital.

The auction, set for yesterday, was called off after Centerbridge Partners offered approximately $3.3 billion for LightSquared, $1.1 billion more than the bid by Dish. Harbinger and LightSquared have tried, unsuccessfully to date, to block Dish's offer, accusing Dish Chairman Charlie Ergen of fraudulently buying up a majority of LightSquared's debt.

Under Centerbridge's proposal, both Harbinger and Fortress Investment Group, which had mulled a bid of its own, will be minority investors in LightSquared, as will JPMorgan Chase. It would become the basis for a bankruptcy-exit plan for Virginia-based LightSquared.

Still, the Centerbridge offer is not a done deal: According to The Wall Street Journal, talks between the private equity firm and LightSquared are fluid, and ultimately depend on the Federal Communications Commission's agreement to allow LightSquared to proceed with building its network. Dish's offer isn't conditional on such approval.

Harbinger was forced last year to put LightSquared into bankruptcy protection after the FCC barred the company from using its spectrum for wireless Internet, citing interference concerns with global positioning systems.


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