Morgan Hedge | Hedge Fund Database

Harbinger backed LightSquared calls for new tests of its mobile network

Date: THU, JAN 19 2012
Topic: Funds & Investment

LightSquared, the telecom start-up backed by hedge fund manager Philip Falcone, called for new tests of its mobile system to examine interference concerns after it accused the latest government tests of being "rigged."

The new tests could take two months, forcing LightSquared to miss a January deadline for government approval of a high-speed wireless network it wants to build.

The January deadline was imposed by Sprint Nextel Corp, LightSquared's partner in deploying and operating its planned network. It is unclear whether Sprint would stay on board if LightSquared misses the deadline.

LightSquared has spent more than $1m on lobbying efforts in Washington to try to gain approval for its wireless network, but is fighting an uphill battle as opponents point to safety and national security risks associated with interference to GPS.

The company reported a $427m net loss for the first nine months of 2011 and could run out of money this year if it cannot raise additional capital and financing.

A failure of LightSquared would be another blow to investors in Falcone's Harbinger Capital Partners hedge fund, which has committed more than $3bn in equity and loan commitments to the company.







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