LightSquared posted a loss of $67.5 million in October, bringing the wireless venture’s total losses since its May 2012 bankruptcy filing to $1.73 billion.
Once again, the bulk of the company’s losses came from interest paid on its debt, which cost $41.6 million in October and has now topped $1 billion since the start of the case.
LightSquared is again trying get a reorganization plan approved by the bankruptcy court, this time a proposal that would give control of the company to Dish Network Corp. Chairman Charlie Ergen, the company’s biggest lender.
A group of bank lenders, who would see their roughly $1 billion in debt satisfied in full, support the plan. The only major constituent who doesn’t back the deal is Philip Falcone, who owns LightSquared’s equity through his Harbinger Capital Partners hedge-fund firm and but would own none of the company under the proposal.
Judge Shelley Chapman, who is overseeing LightSquared’s bankruptcy, recently warned LightSquared and its creditors that she may consider converting the case to a Chapter 7 liquidation if a new deal wasn’t reached. Mediation with another New York bankruptcy judge, Robert Drain, eventually led to the new deal.
LightSquared has presented restructuring plans in the past, though all either fell through or were rejected by Judge Chapman. The judge has also noted the high cost of the bankruptcy, an inevitability considering the age of the case and the high-profile law firms involved.
LightSquared paid $4.3 million in professional fees during October, bringing that total to $121.1 million since the beginning of the case.
Other expenses include $1.2 million paid toward salaries, commissions and fees during October, which total $134.1 million since the beginning of the case. The company also paid a $6 million spectrum reuse fee and has put $55.6 million toward such fees since the May 2012 Chapter 11 filing.
The bankruptcy filing occurred after federal regulators refused to clear LightSquared’s plans to launch its wireless network, after heeding warnings from the global positioning systems industry that the network could interfere with GPS.
LightSquared isn’t able to fully use spectrum — limited pockets of airwaves that mobile-phone and Internet companies use — that it owns without support from the Federal Communications Commission. The FCC has so far refused to grant such approval.
