Judge Says DBSD Can Move Forward With Sale To Dish Network
By Joseph Checkler, Of DOW JONES DAILY BANKRUPTCY REVIEW
NEW YORK -(Dow Jones)- A judge on Tuesday said DBSD North America Inc. can move forward with an agreement to sell itself to Dish Network Corp. (DISH), after the companies struck an amended deal that would pay all of DBSD's unsecured creditors in full.
"The bottom line is very, very favorable for the creditor community," Judge Robert E. Gerber of U.S. Bankruptcy Court in Manhattan said.
Ryan Bennett of Kirkland & Ellis LLP, a lawyer for DBSD, said the company held an auction for DBSD's assets in March and that Dish's $1.4 billion offer was superior to others. In February, Dish had offered $1.1 billion.
Phil Falcone's Harbinger Capital Partners hedge-fund firm and fellow investment company Solus Alternative Asset Management, which earlier this month filed a competing plan for the company, weren't present in court Tuesday according to DBSD and its creditors.
Lawyers for DBSD's unsecured creditors and DBSD Parent ICO Global Communications Holdings Ltd. spoke in support of the plan, and a lawyer for long-time objecting creditor Sprint Nextel Corp. (S) said he will at the moment "take everyone's word for it" that a Sprint claim will be paid in full.
Sprint said it is owed more than $104 million for a satellite license agreement, an amount that could result in either a court fight or a settlement. The Dish agreement proposes a $40 million settlement that Sprint could take immediately.
"I really think this is a win-win for everybody," said Steven J. Reisman of Curtis, Mallet-Prevost, Colt & Mosle LLP, a lawyer for DBSD's official committee of unsecured creditors.
The amended agreement between DBSD and Dish still must be confirmed by the court and requires approval from the Federal Communications Commission. As part of approving the two sides to go forward with the plan, Gerber also gave the go- ahead for DBSD to replace its existing bankruptcy loan from Dish with a new $ 87.5 million debtor-in-possession loan.
DBSD, a unit of ICO, filed for bankruptcy in 2009 and had its plan confirmed by Gerber.
That plan called for bondholders to swap $740 million in debt for a 95% stake in the reorganized company. Dish, the sole holder of $40 million in first-lien loans, would have had its debt continued with the new company under amended terms.
But both Dish and Sprint objected to the confirmation, and they got their wish in late 2010 when a court overturned it. Dish had called the plan unfeasible, and Sprint objected to the way the plan ranked it lower than other creditors.
DBSD, based in Reston, Va., is developing a system that combines both satellite and terrestrial communications capabilities for wireless voice, data and Internet services.
Dish is controlled by satellite-television mogul Charles Ergen, who also is seeking to use his other publicly traded company, EchoStar Corp., (SATS) to bring TerreStar Networks Inc. out of bankruptcy.
Falcone and Solus are both also involved in the TerreStar case, and had said in their competing offer for DBSD that they were interested in a DBSD/TerreStar merger. An attorney for Harbinger declined to comment."
Source
No comments:
Post a Comment