Space News by Caleb Henry — February 20, 2020
Intelsat on Feb. 19 urged the FCC to give the company at least $1 billion more of $9.7 billion in proposed compensation for clearing C-band spectrum for 5G networks and to treat the C-Band Alliance Intelsat formed with rivals SES and Telesat as essentially dead.
Intelsat said it has more C-band revenue, capacity use and satellite dishes in operation across the continental United States than any other operator, and that it therefore deserves $5.8 billion to $6.5 billion in accelerated clearing payments instead of the $4.85 billion offered under the U.S. Federal Communications Commission’s proposed plan.
The company’s solo gambit, which earned a sharp rebuke from SES and approval from investors, followed one day after hedge fund Appaloosa of Short Hills, New Jersey, took a 7.4% stake in Intelsat for the express purpose of compelling the company to demand more clearing payments from the FCC.
Appaloosa said the FCC’s order, which would repurpose 280 megahertz of satellite C-band spectrum for 5G, gives Intelsat only “token compensation†for the high-value spectrum while overloading the debt-riddled satellite operator with costs it may not be able to finance.
Without better terms, Appaloosa said its conviction is that Intelsat “has no choice but to resort to bankruptcy and litigation in order to protect Intelsat’s valuable license rights from an illegal modification.â€
In an earnings call Feb. 20, Intelsat CEO Steve Spengler made no mention of the Appaloosa investment, but defended the satellite operator’s decision to unilaterally lobby the FCC.
“It was very clear that the FCC was treating each satellite operator individually†following its draft C-band plan released Feb. 7, Spengler said. “Therefore we believe it made sense for each company to respond from its own perspective once the FCC changed that orientation.â€
More:
https://spacenews.com/intelsat-to-fcc-c-band-alliance-is-dead-we-deserve-more-money/
