Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

4-Traders Homepage  >  Equities  >  Nasdaq  >  DISH Network Corp    DISH

SummaryQuotesChartsNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsSector news 

DISH Network : Falcone says suppressing Ergen's debt is key to LightSquared restructuring

share with twitter share with LinkedIn share with facebook
share via e-mail
0
04/01/2014 | 01:46am CET

Investor Phil Falcone, whose Harbinger Capital Partners owns bankrupt wireless company LightSquared, on Monday said he always intended to cut the debt claims of LightSquared's largest creditor, Dish Network Corp Chairman Charlie Ergen.

"I don't think Charlie should have been in the capital structure," Falcone said during testimony in U.S. Bankruptcy Court in Manhattan, in the third week of hearings in which LightSquared is seeking court approval of its plan to exit bankruptcy and repay creditors.

The plan would pay most lenders in cash while paying Ergen in the form of a long-term note, terms to which Ergen has objected.

Under intense questioning from Ergen's attorneys, Falcone acknowledged that he believed subordinating Ergen's claims would allow Harbinger to retain equity in a post-bankruptcy LightSquared.

Treating Ergen's $1.1 billion claim differently from other creditors' claims would decrease the amount of new equity LightSquared would need to raise to a fund a bankruptcy exit, preserving more for Harbinger, according to Falcone. The plan would retain a roughly 30 percent equity stake for Harbinger.

LightSquared filed for Chapter 11 in 2012, when the Federal Communications Commission revoked its license to build a massive planned wireless network over concerns it could interfere with GPS systems. Ergen later acquired a big enough chunk of the company's senior loan that he could essentially block any restructuring plan he disagreed with.

LightSquared and Harbinger believe they can subordinate Ergen's claim because, according to them, he acquired his stake illegally, violating a credit agreement barring competitors like Dish from holding LightSquared debt.

In a separate and still-pending lawsuit, LightSquared alleges Ergen was acting for Dish when he bought the debt, with an eye toward setting the stage for a Dish takeover. Ergen has said from the outset the purchases were solely for his personal portfolio.

A Dish unit did make a $2.2 billion offer for LightSquared's valuable spectrum, but dropped the bid in January.

Monday marked the end of witness testimony in weeks of hearings, and it is now up to Judge Shelley Chapman to assess Ergen's motivations for accumulating debt. Whether Chapman deems Ergen to have acted improperly will be the key factor in whether she approves the bankruptcy exit plan.

If Chapman finds that Ergen did not act improperly, LightSquared could find itself in a tight negotiating spot, as Falcone conceded that no alternative restructuring plan is on the table right now.

Chapman's decision is expected to take several weeks, with LightSquared and Ergen planning to submit post-trial court briefs by May 2. But time is of the essence for LightSquared, which could run out of money by April 15, when its $33 million bankruptcy loan expires. LightSquared plans to address that issue in the coming days, its lawyer said on Monday.

Falcone said Harbinger initially wanted to disallow Ergen's claims entirely. But to facilitate a restructuring, he agreed to

support a deal premised on equity contributions from Fortress Investment Group and Melody Capital that would subordinate the claims behind those of other lenders.

An independent committee overseeing the restructuring has said it supports the move.

(Reporting by Billy Cheung; Writing by Nick Brown; Editing by Lisa Shumaker)

By Billy Cheung

share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on DISH NETWORK CORP
11/28 SLING TV : Introduces Cloud DVR, to Debut in Beta for Select Roku Users
11/24 DISH NETWORK : Assigned Patent
11/17 DISH NETWORK : Assigned Patent
11/10 DISH NETWORK : Lost Another 116,000 TV Subscribers Last Quarter
11/09DJDISH NETWORK : CEO Hopeful About Trump's Impact on Infrastructure, Taxes
11/09DJNet-Neutrality Rules Could Be Eased Under Donald Trump, Some Say
11/09DJCompanies Weigh Impact of Donald Trump Win
11/09 Dish Network posts lower-than-expected profit, loses subscribers
11/09 DISH NETWORK : misses 3Q profit forecasts
11/09 DISH NETWORK : MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND R..
More news
Sector news : Cable Service Providers
12/02 Trump creates business advisory council stacked with CEOs
11/30DJCBS : Grant Tinker, Former NBC Chairman, Is Dead at 90
11/30 Sky seeks to shake up UK mobile market with flexible data plans
11/29DJSKY : Pre-Registers 46,000 Customers for Mobile Service
11/29 MERLIN ENTERTAINMENTS : forecasts profit growth this year
More sector news : Cable Service Providers
News from SeekingAlpha
11/23 BEST AND WORST Q4'16 : Mid Cap Growth ETFs, Mutual Funds And Key Holdings
11/17 Tracking George Soros's Portfolio - Q3 2016 Update
11/16 With White House changing, set-top box reform may be on life support
11/10 WALL STREET BREAKFAST : Equities Board The Trump Train
11/10 What AT&T Should Learn From Sony's Surprising Streaming Pitfall
Advertisement
Financials ($)
Sales 2016 15 123 M
EBIT 2016 2 185 M
Net income 2016 1 455 M
Debt 2016 9 630 M
Yield 2016 -
P/E ratio 2016 18,44
P/E ratio 2017 20,76
EV / Sales 2016 2,34x
EV / Sales 2017 2,31x
Capitalization 25 833 M
More Financials
Chart DISH NETWORK CORP
Duration : Period :
DISH Network Corp Technical Analysis Chart | DISH | US25470M1099 | 4-Traders
Full-screen chart
Technical analysis trends DISH NETWORK CORP
Short TermMid-TermLong Term
TrendsNeutralNeutralNeutral
Technical analysis
Income Statement Evolution
More Financials
Consensus
Sell
Buy
Mean consensus HOLD
Number of Analysts 26
Average target price 72,9 $
Spread / Average Target 31%
Consensus details
EPS Revisions
More Estimates Revisions
Managers
NameTitle
Charles William Ergen Chairman & Chief Executive Officer
W. Erik Carlson President & Chief Operating Officer
Steven E. Swain Chief Financial Officer & Senior Vice President
Roger J. Lynch Executive Vice President-Advanced Technologies
Vivek Khemka Chief Technology Officer & Executive VP
More about the company
Sector and Competitors
1st jan.Capitalization (M$)
DISH NETWORK CORP0.47%25 833
LIBERTY GLOBAL PLC-26.06%29 850
LIBERTY GLOBAL LILAC-49.02%29 850
LIBERTY BROADBAND CORP34.62%12 550
CYFROWY POLSAT SA14.93%3 589
MEGACABLE HOLDINGS SAB..-0.51%2 721
More Results