Feeds

LightSquared founder Falcone steps aside on creditor's orders

Swaps power for seven-day debt extension

The essential guide to IT transformation

Philip Falcone, the force behind wannabie network operator LightSquared, has stepped aside in exchange for delaying bankruptcy by a week while a longer extension is negotiated.

LightSqared, the box o' frogs idea to jimmy a cellular network into satellite frequencies, has always been Falcone's baby, financed largely by his hedge fund Harbinger Capital Management and headed by him personally. But investors want him off the board if they're going to agree to a longer extension, and continue negotiations with the FCC, claims the Wall Street Journal.

Falcone's hedge fund, Harbinger, has funnelled more than 60 per cent of its $3.8bn pot into LightSquared, but responding to enquiries from the WSJ, Falcone pointed out that his experience was in hedge-fund management and that his position on the LightSquared board was only supposed to be temporary.

One might argue that a "hedge fund" with 60 per cent invested in one project is slipping away from its modus operandi; hedge funds are supposed to invest in competing businesses so they always come out marginally on top, but Falcone has already stated his desire to get away from the kind of operation.

Falcone joined the board of LightSquared when Orange veteran Sanjiv Ahuja stepped down as CEO in February, 10 days after the FCC withdrew the licence waiver upon which the entire LightSquared business model depended. Since then LightSquared has been looking for a replacement CEO, but few people are interested in heading up a network operator without any radio spectrum in which to operate a network.

The threat of bankruptcy still lurks for the company, whose only long-term hope seems to lie in using the threat of legal action to frighten the FCC into browbeating the US military into agreeing to a spectrum swap, thereby exchanging LightSquared's too-close-to-GPS bands for something more commercially viable.

But even if that were possible, and the rest of the US network operators could be persuaded not to notice, it's not going to happen immediately before a US presidential election, which makes a debt extension of at least 12 months essential if LightSquared is going to have any future at all. ®

Next gen security for virtualised datacentres

More from The Register

next story
6 Obvious Reasons Why Facebook Will Ban This Article (Thank God)
Clampdown on clickbait ... and El Reg is OK with this
No, thank you. I will not code for the Caliphate
Some assignments, even the Bongster decline must
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
Barnes & Noble: Swallow a Samsung Nook tablet, please ... pretty please
Novelslab finally on sale with ($199 - $20) price tag
Ballmer leaves Microsoft board to spend more time with his b-balls
From Clippy to Clippers: Hi, I see you're running an NBA team now ...
Banking apps: Handy, can grab all your money... and RIDDLED with coding flaws
Yep, that one place you'd hoped you wouldn't find 'em
Video of US journalist 'beheading' pulled from social media
Yanked footage featured British-accented attacker and US journo James Foley
Call of Duty daddy considers launching own movie studio
Activision Blizzard might like quality control of a CoD film
Primetime precrime? Minority Report TV series 'being developed'
I have to know. I have to find out what happened to my life
prev story

Whitepapers

A new approach to endpoint data protection
What is the best way to ensure comprehensive visibility, management, and control of information on both company-owned and employee-owned devices?
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.
Maximize storage efficiency across the enterprise
The HP StoreOnce backup solution offers highly flexible, centrally managed, and highly efficient data protection for any enterprise.
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.
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.