Hedge-fund manger Philip Falcone's LightSquared Inc. venture
is preparing for a potential bankruptcy-protection filing, as negotiations with
lenders to avoid a potential default faltered, people familiar
with the matter told the NY Post.
The two sides still have until 5:00pm Monday to reach a deal
that would keep LightSquared out of bankruptcy court, and there were
indications over the weekend that a final decision hadn't yet been reached on
the company's fate. Still, the two sides remained far apart and people involved
in the negotiations expected LightSquared to begin making bankruptcy
preparations in earnest.
Lenders aren't expected to grant LightSquared an extension
on a debt-term violations waiver that expires Monday at 5:00pm, the people
said. Falcone, whose hedge-fund firm, Harbinger Capital Partners, is
LightSquared's main backer, couldn't agree with lenders on how much ownership
in the wireless venture to cede to them over time, the people said. There were
also a number of other terms separating the two sides…
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