LightSquared creditors can vote on restructuring plans: judge
By Bill Cheung
NEW YORK (Reuters) - Creditors of bankrupt broadband owner LightSquared Inc can vote on competing plans by LightSquared, its creditors and its primary shareholder, Harbinger Capital, on how to restructure the company, a judge ruled on Wednesday.
Judge Shelley Chapman, in U.S. Bankruptcy Court in Manhattan, said she would sign off on each of the competing plans after the sides resolved disputes surrounding certain disclosures in the language of the proposals.
LightSquared, controlled by Phil Falcone's Harbinger, is trying to stave off an aggressive bid by Dish Network Corp (DISH.O: Quote), owned by Charlie Ergen, for control of its spectrum. The assets are likely to be auctioned off to the highest bidder, with Dish having already made a baseline offer for some of the spectrum.
LightSquared and its lenders have pushed competing proposals for the parameters of a sale, while Harbinger has put forth a plan that would restructure LightSquared without a sale.
LightSquared filed for Chapter 11 in May of 2012, after the Federal Communications Commission tentatively stopped it from building its network amid concerns in the GPS industry about potential signal interference from a swath of LightSquared's broadband.
Subject to final court approval over the revised language in the plan outlines, creditors will have the right to vote for any of the proposals by December 5.
LightSquared's restructuring plan, along with two other plans proposed by different groups of lenders, contemplates an auction of the company's assets while LightSquared continues to pursue FCC approval to develop its suspended spectrum. Continued...