Feeds

Court approves latest stage of McCaw's ICO ‘rescue’

$350m more to be pumped into ailing satellite company

  • alert
  • submit to reddit

Boost IT visibility and business value

Entrepreneur Craig McCaw's attempt to rescue -- and in the process take control -- troubled satellite networking company ICO Global Communications on Friday won the backing of the US bankruptcy court. Last month, the court allowed McCaw to pump in $150 million in interim debtor-in-possession financing. The latest ruling permits McCaw to take that figure to $225 million and throw in a further $275 million in second-round financing next January. McCaw's plan also calls for a further $700 million to be injected into ICO, taking the total investment to $1.2 billion. However, that part of the plan has yet to be approved by the bankruptcy court, but its approval seems now little more than a formality. ICO said McCaw's money would be used to fund the conversion of its as-yet-unlaunched satellite network from a cellphone system along the lines of the one run by Iridium into a broadband data network not dissimilar to the one planned by McCaw's company, Teledesic. ICO plans to launch its satellite network sometime in Q2 2001. McCaw isn't the only investor in the ICO recovery plan, but he remains the largest. Of the $700 million inject yet to be approved by the court, for instance, he will put up 62 per cent, with the remaining 38 per cent being supplied by Indian media mogul Subhash Chandra. Meanwhile, McCaw's focus on satellite-based networks is now turning to Iridium, the other bankrupt satellite service. Sources suggest McCaw and Iridium are close to signing a rescue deal which, like the ICO plan, would see a McCaw-led consortium of investors pump money into the ailing company in return for McCaw's elevation to chairman of the board or some similar senior executive role. Given the problems Iridium's biggest shareholder, Motorola, has had persuading the satellite company's other institutional investors to back the management's restructuring plan, some kind of 'passing the buck to McCaw' move seems a very likely possibility, ultimately leading to a unification of the three operations -- Teledesic, ICO and Iridium -- into a single business. With Teledesic keen to get up and running sooner than later, using ICO's in-production and Iridium's already launched satellites to provide data and voice communications, respectively would certainly be a major step in that directions. ® Related Stories ICO wins court approval for McCaw's $150m cash injection Teledesic's McCaw to bail out ICO Iridium rival ICO plans Teledesic makeover Teledesic to launch sooner than expected

The Power of One Brief: Top reasons to choose HP BladeSystem

More from The Register

next story
Stick a 4K in them: Super high-res TVs are DONE
4,000 pixels is niche now... Don't say we didn't warn you
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
Philip K Dick 'Nazi alternate reality' story to be made into TV series
Amazon Studios, Ridley Scott firm to produce The Man in the High Castle
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Bose says today is F*** With Dre Day: Beats sued in patent battle
Music gear giant seeks some of that sweet, sweet Apple pie
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
Too many IT conferences to cover? MICROSOFT to the RESCUE!
Yet more word of cuts emerges from Redmond
Joe Average isn't worth $10 a year to Mark Zuckerberg
The Social Network deflates the PC resurgence with mobile-only usage prediction
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Application security programs and practises
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Securing Web Applications Made Simple and Scalable
Learn how automated security testing can provide a simple and scalable way to protect your web applications.