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Iridium granted 30-day reprieve

Has until 30 June to prove punters want it

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Iridium's bankers last week came to the troubled satellite-based mobile phone service's rescue -- well, sort of. The good news for Iridium was an extension to the last deadline its lenders imposed on it to either hit customer and revenue projections or pay back its massive debt. The bad news is that it only has a month to do so. Iridium's arguments for a further delay -- its debt repayment deadline has already been put back, from the end of March to 31 May -- will have centred on the establishment of its new management team, primarily interim CEO John Richardson and CFO Leo Mondale; its decision to take its sales and marketing teams, dubbed by the company as "weak", to task; and to just give it time to see if can persuade its backers to support its proposed finanicial restructure. Speaking last week, before the banks' decision was announced, Mondale said the ailing company's options were essentially to restructure or file for bankruptcy. Motorola, for one, will be keen to pursue Iridium's latest plan. Not only does it own 18 per cent of the company, but it has guaranteed most of the satellite service's debt. However, the deal with Iridium's bank is not exclusively financial. It also needs show it has at least 27,000 subscribers by the 30 June deadline. It managed to notch up a little over 10,000 by the end of March. More than doubling that figure in one quarter alone would be hard enough for any company, let alone one as unhealthy as Iridium. On the financial side, Iridium's books must show a $4 million cash reserve and $30 million of cumulative accrued revenues. Its Q1 revenue was just $1.45 million. ® See also Missing Iridium 'suit' located

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