Harbinger exits Inmarsat - 65,000,000 Inmarsat shares by the Harbinger Funds on 5 October 2010.

"Proving once again that lock-up arrangements with big investment banks aren’t worth the paper they’re written on, news reaches the FT Alphaville desk that Philip Falcone’s Harbinger Capital Partners is placing its remaining 14 per cent stake in Inmarsat.

Credit Suisse and UBS are trying to find buyers for 64m shares on Monday evening. There are no details yet on pricing but shares in the satellite communications group closed at 688p.

Harbinger sold half of its Inmarsat holding at 630p a share in October, raising a cool £410m. The sale came shortly after a Harbinger vehicle and Inmarsat signed a co-operation agreement for leasing its spectrum in the US.

Anyway … enough background.

Here’s what was said in October about the remaining 14 per cent holding:

Following this Transaction, the collective shareholding of Harbinger and its affiliated investment funds is reduced to 64,277,349 ordinary shares in Inmarsat, representing approximately 14.0 per cent. of Inmarsat’s issued share capital. This remaining shareholding will be subject to a 180 day lock-up arrangement with Credit Suisse and UBS Investment Bank.

And this evening’s update:

Credit Suisse and UBS Investment Bank have been appointed as Joint Bookrunners with respect to the Transaction and have also consented to the waiver of certain lock-up arrangements which were in place following the sale of 65,000,000 Inmarsat shares by the Harbinger Funds on 5 October 2010.

Moral of the story: shares are only locked-up until everyone agrees they are not locked-up at which point they can be dumped into the market. Investors beware.

As for the reasons behind Harbinger’s sale, we can only speculate.

Related link:
Harbinger Capital cuts Inmarsat stake - FT

This entry was posted by Neil Hume on Monday, February 7th, 2011 at 18:00 and is filed under Capital markets, M&A, People. Tagged with credit suisse, harbinger,Inmarsat, Philip Falcone, ubs. "

Source

http://ftalphaville.ft.com/blog/2011/02/07/481451/harbinger-exits-inmarsat/

$500 million funding commitment

"SkyTerra’s view, the $500 million funding commitment obtained from Harbinger in July 2008 provided the capital necessary to fund SkyTerra’s business operations through the third quarter of 2010. As such, SkyTerra was focused on executing one or more strategic alternatives prior to the end of this funded period.

The primary strategic alternatives included (i) the closing of a potential SkyTerra/Inmarsat combination, (ii) attracting a strategic partner to pursue an integrated satellite–terrestrial (“mobile satellite services–ancillary terrestrial component services” or “MSS–ATC”) opportunity in the North American market,

(iii) development of an MSS–only business plan anchored by a core satellite roaming partner, and/or (iv) a sale of SkyTerra.

In considering its alternatives, SkyTerra, consistent with its obligations under the MCSA, continued to support Harbinger’s activities in connection with the potential SkyTerra/Inmarsat combination.

In the next approximately nine months following the signing of the MCSA in July 2008, SkyTerra continued to support implementation of the MCSA while simultaneously pursuing strategic investments and business opportunities consistent with the commitments made in the MCSA and SkyTerra’s view that an acquisition of Inmarsat pursuant to the MCSA would be more beneficial to the interests of SkyTerra and its stockholders than the transactions contemplated by the Cooperation Agreement.

This had been discussed by Mr. Good on quarterly earnings calls with investors subsequent to the execution of the MCSA.

In the view of SkyTerra management and the board of directors, the process for regulatory approvals and financing for the possible offer for Inmarsat was extended, in part, as a result of the change in political administration in the United States as well as challenging and illiquid capital markets and the impact of the credit crisis.

In a March 4, 2009 letter, Harbinger and SkyTerra requested that the FCC process the applications proposing a transfer of control of SkyTerra LP’s FCC licensed subsidiary to Harbinger separately from the applications for transfer of control of Inmarsat.

The SkyTerra management and board of directors were made aware of the increasing uncertainty that the acquisition of Inmarsat could be financed and closed prior to the depletion of SkyTerra’s available funding.

In April 2009, the board of directors authorized the special committee to work with SkyTerra management, Morgan Stanley and Skadden to analyze funding and restructuring alternatives in light of the foregoing uncertainties.

On June 9, 2009, with Morgan Stanley’s encouragement, SkyTerra held a meeting of the board of directors to discuss the recent bankruptcy filing of DBSD North America (a mobile satellite services provider), which we refer to as “ICO,” and the implications of such bankruptcy filing for SkyTerra.

At the meeting, Morgan Stanley observed that the capital markets for new issue debt financings for spectrum–backed entities remained illiquid and unavailable to ICO. Morgan Stanley noted that strategic interest from third–parties for ICO’s assets was limited prior to the bankruptcy filing and that, as a result, the value of the equity interests in ICO was likely to be severely impaired in the bankruptcy proceeding based on indicative value ranges implied by the contemplated restructuring.

Morgan Stanley further noted that while SkyTerra did possess sufficient financial resources to fund its business operations through the third quarter of 2010, securing funding from financial and/or strategic investors in the current economic environment would prove challenging. Morgan Stanley noted that third parties identified by management as most likely to be interested in providing funding or proposing an acquisition of SkyTerra had chosen not to provide funding to or propose an acquisition of ICO to date, nor to commit the capital necessary to support a new 4G network deployment.

In Morgan Stanley’s judgment, the board would be warranted in exploring ways to restructure SkyTerra’s debt obligations and other liabilities, including payments to Boeing and other vendors, to extend SkyTerra’s ability to fund its business operations beyond the third quarter of 2010.

On July 24, 2009, SkyTerra selected a new launch window for its SkyTerra–1 satellite of August through October 2010 (as compared to the previous March through May 2010 window) based on a potential delay in delivery of SkyTerra–1 after receiving the most recent estimated delivery information from Boeing Satellite Systems (the manufacturer of the SkyTerra–1 satellite).

On July 30, 2009, Morgan Stanley met with the SkyTerra board of directors and provided the board of directors with a preliminary overview of SkyTerra’s strategic and financing alternatives."

http://www.sec.gov/Archives/edgar/data/756502/000119312510041152/ddefm14a.htm#toc19437_32

"How Phil Falcone scored airwaves for iPhones
Posted by Scott Woolley
January 27, 2011 1:40 PM

Struggling financier Phil Falcone hopes to build a new $8 billion "4G" network that could speed up wireless service for everyone. Thanks to the big gift of airwaves the FCC just handed him, he might just pull it off.

Verizon (VZ) and AT&T (T) value their airwave licenses at a stunning $122 billion, so its no wonder they pitched a fit last year when financier Phil Falcone asked the Federal Communications Commission to give his start-up a cut-rate pass into their wireless club. Yet despite those objections, the FCC just did exactly that.

Last week FCC decided that a big chunk of the airwaves that Falcone's wireless startup had bought for next to nothing—since at the time those airwaves couldn't legally connect ordinary cell phones—will be usable by iPhones, Droids and Blackberrys after all. In an instant, Falcone's airwaves became vastly more valuable.

Such airwave alchemy—buying the rights to cheap, non-cellular airwaves and convincing the government to turn them expensive, cellular-capable airwaves—is the key to Falcone's plans for his new company, Lightsquared.

The FCC first approved Lightsquared's acquisition of a bunch of cheap airwaves last March. They came cheap because while the airwaves could be used to connect iPhones, regulations had restricted their use to satellite communications.

As part of that deal regulators agreed to also let Lightsquared use those same airwaves to run a network of regular cell towers around the U.S. as an "ancillary service," thus allowing it to support a new type of wireless phone that offers both satellite and cellular connectivity.

Lightsquared commissioned two high-tech satellites that would be able to connect cell phones anywhere in the continental U.S.

(Anywhere outdoors, at least. Satellite connections quickly die out in buildings.) Still, the company assured regulators that the satellites were the main focus and the cellular towers on the ground merely an "ancillary terrestrial component."

It was regulatory kabuki. Everyone knew that the most valuable use of the airwaves was the ostensibly "ancillary" part—the network of ordinary cell towers that could zip phone calls and data to smartphones. Officially, however, that was just an afterthought.

Then in November, just after the successful launch of its first $600 million satellite, Lightsquared informed the FCC that its plans had "evolved."

From the beginning, Lightsquared never planned on selling wireless service directly to consumers, a fact which suddenly came in very handy.

Lightsquared was still committed to offering integrated satellite-cellular service, the company told regulators, but what if the companies Lightsquared sold wholesale capacity to then turned around and offered only the cellular service to owners of Apple's (AAPL) iPhone and other smartphones?

Competitors like Verizon Wireless howled, alleging a transparent sham that sought to end run FCC rules.

"There is no support for such a proposition, as the Commission has clearly stated that the integrated service requirement is intended to ensure that the public receives the benefit of an integrated [satellite plus cellular] offering," Verizon fumed in a brief with the FCC.

It did no good. Through guile or good luck, Falcone had managed to time the national political mood just right.

Lightsquared has vowed to spend $8 billion on the new network, mostly on putting up of traditional cell towers. (All of Lightsquared's towers will run "LTE," the newest generation cellular technology.)

That spending will create 100,000 jobs the company says. Thus Falcone offered the Obama administration three of the things it most wants now: new jobs, increased corporate spending and investment in America's digital infrastructure.

Also, unlike existing cell carriers, Falcone vowed to run Lightsquared as an "open" wholesale network.

That appealed to the network neutrality fans such as FCC chairman Julius Genachowski, who has pushed for wholesale service in the past.

And so it was that the FCC decided last week that ordinary (non-satellite capable) smartphones will be allowed to use Lightsquared's network after all.

Was that a good decision? Freeing airwaves to be used by the people that value them most highly—iPhone, Droid and other smartphone users—will produce two things. The first is better wireless service for regular Americans. The second is instant riches for whoever owns the airwaves that get freed up."

Source

http://tech.fortune.cnn.com/2011/01/27/how-phil-falcone-scored-airwaves-for-iphones/

Falcone in Bed with the FCC..

Harbinger Capital Partners Lightsquared Threatens Clearwires Turf

"Falcone’s LightSquared to Take on Clearwire in Chicago, Dallas

August 31, 2010, 12:04 AM EDT

Aug. 31 (Bloomberg) -- Billionaire Philip Falcone’s LightSquared plans to expand to as many as nine U.S. metro areas next year, challenging Clearwire Corp.’s lead in offering fourth-generation wireless services, company documents show.

The closely held venture, backed by Falcone’s Harbinger Capital Partners hedge fund, will extend its network to Dallas, Chicago and Minneapolis in 2011, according to documents sent to potential partners. The company’s network may grow to 20 cities in 2012, including New York, San Francisco and Los Angeles.

Falcone started LightSquared on the assumption the U.S. wireless industry has room for another entrant.

The documents show the company will offer 4G service largely in the middle of the country first and then expand to the coasts.

Sprint Nextel Corp. already markets 4G through a venture with Clearwire; AT&T Inc. and Verizon Wireless plan to do so in the coming months.

“It’s an ambitious plan,” Steve Clement, an analyst with Pacific Crest Securities in Portland, Oregon, said in an interview. “If these guys can get it up and running well, Clearwire will have a reason to be concerned.”

LightSquared Chief Executive Officer Sanjiv Ahuja confirmed the content of the documents, adding that some specifics have changed since they were distributed late last year. Ahuja, who ran Orange SA in Europe, said he sees an opportunity to bring better and more innovative service to the U.S.

“There is a big demand-supply gap and we are trying to step in and fill some of that,” he said in an interview in New York. “In terms of wireless penetration, the United States today is nowhere near the top countries.”

Wholesale Model

LightSquared, formed through Falcone’s acquisition of SkyTerra Communications Inc., plans to sell capacity on its network to cable providers, consumer electronics companies and technology companies.

That way a personal computer maker or television manufacturer could sell wireless service to consumers at the same time they sell their devices.

With 4G Technology, the users of devices including smartphones can surf the Internet and download data more easily than with existing technology.

“We are negotiating across all categories,” said Ahuja, 54, declining to provide company names. He said he was close to completing agreements with 10 technology companies, and “many of them could take several months to get finalized.”

LightSquared, based in Reston, Virginia, had expected this year to add 300 base stations, which handle network traffic, and about 5,000 by the end of 2011, according to the documents. Ahuja said LightSquared’s base station targets had changed and declined to give specific figures.

In 2012, LightSquared will add about 13,000 base stations in 11 more metropolitan areas, according to the documents.

LightSquared is on track to begin constructing its network in December, Ahuja said.

Clearwire Competition?

Clearwire may see the most direct competitive threat from LightSquared, according to Clement. Clearwire, majority owned by Sprint, sells wholesale capacity on its network to corporate partners, in addition to marketing its Clear brand wireless service directly to U.S. consumers.

Clearwire has a head start, offering 4G service to roughly 56 million people. The company built its network to encompass about 50 U.S. cities since January 2009, said Jeremy Pemble, a spokesman for the Kirkland, Washington-based company. By the end of 2010, it will expand to Boston, New York, San Francisco and Los Angeles, he said.

Carriers are moving into 4G as consumers’ usage habits swing more heavily toward data use, such as video streaming and photo sharing. Chetan Sharma, an independent analyst, expects consumers to double their average data use by year’s end, compared with 2009.

LightSquared has reached out to about 35 technology companies, Ahuja said. “Our negotiations have progressed on a much faster pace than we had originally planned for,” he said.

LightSquared has agreements with several firms to provide devices to carriers who buy its wireless capacity. The company aims to provide terrestrial coverage, supplemented by two satellites, to reach at least 260 million people over the next five years.

--Editors: Peter Elstrom, Kevin Miller

To contact the reporter on this story: Greg Bensinger in New York at gbensinger1@bloomberg.net

Source

http://www.businessweek.com/news/2010-08-31/falcone-s-lightsquared-to-take-on-clearwire-in-chicago-dallas.html

Proskauer Rose - Harbinger Capital Partners

Harbinger Capital Partners - Proskauer Rose Connections

http://www.proskauer.com/professionals/daniel-ganitsky/

Daniel I Ganitsky | Professionals | Proskauer

... by a consortium of financial institutions including, Appaloosa Management, Harbinger Capital Partners, Goldman Sachs, Merrill Lynch and UBS Securities ...
www.proskauer.com/professionals/daniel-ganitsky/

" Private Equity Group is a dynamic, interdisciplinary team of lawyers who, along with our market-leading Private Investment Funds Group, offer a complete range of services to our private equity clients, including buyouts, growth equity, recapitalizations, restructurings, venture capital and fund formation. Based out of our New York, Hong Kong, London, Los Angeles, Paris, Boston, São Paulo, Boca Raton and Washington DC offices, we advise our global client base on private transactions throughout the world. We focus on large cap, middle market and lower middle market work, and are recognized leaders and, during the past two years, closed more than 300 private equity transactions.

The international breadth and depth of our client base sets us apart from other private equity practices and, supported by our fund formation capabilities and access to a global platform of every relevant practice area, we offer a range of experience few firms can match.

Areas of Focus

• Buyouts
• Growth Equity
• Executive Compensation
• Leveraged Recapitalizations
• PIPEs
• Private Company Representation
• Restructurings and Workouts
• SPACs
• Venture Capital
  

Key Representations

• Ares Management and Ontario Teachers’ Pension Plan in the $1.65 billion acquisition of General Nutrition Centers
• Charterhouse Group as a majority shareholder in AAT Communications Corporation’s $1 billion sale to SBA Communications Corporation
• Arsenal Capital Partners in the sale of Vertellus Specialty Chemicals for $540 million"
  
  
  
  

  Experience

  J.P. Morgan U.S. Corporate Finance II/Educate Inc.

  JPMorgan Invesment Management Inc./Thoma Bravo Syndicate JPMorgan Investment Mangement Inc. in Thoma Bravo Syndicate's $272,000,000 leveraged buyout of Sonic Wall

  JPMorgan Invesment Management Inc./Thoma Bravo Syndicate JPMorgan Investment Mangement Inc. in Thoma Bravo Syndicate's $272,000,000 leveraged buyout of Sonic Wall

  J.P. Morgan U.S. Corporate Finance III/Kinderhook

  Acquisition of Motor Transport Group Corinthian Capital Group in the acquisition of Precision Motor Transport Group by means of a recapitalization valued at $55 million

  Preferred Stock Acquisition ARCH Venture Partners and an investment group in the acquisition of series B preferred stock from Sapphire Energy Inc. for $90 million

  Stock Investment for Goldman Goldman Sachs Group Inc. in a $25.5 million preferred stock investment in DataPipe, Inc.

  Acquisition of $2 Billion Bank Portfolio Ares Management in the acquisition of a $2.1 billion portfolio of investments from a major investment bank

  Charterhouse Acquisition Charterhouse Group Inc. in the acquisition of Chamberlin Edmonds & Associates, Inc. for $120 million

  Minority Stake in Westwood One An entity managed by The Gores Group, LLC in the acquisition of a $100 million minority stake in Westwood One, Inc.

  LBO of Brokerage Firm Arsenal Capital Partners in the leveraged buyout of Charter Brokerage Holdings, LLC, for $167 million

  Sale of Specialty Chemical Company Arsenal Capital Partners in the sale of Vertellus Specialty Chemicals for $540 million

  Buyout of Ambulatory Surgery Group Texas Pacific Group in the buyout of HealthSouth Corporation’s ambulatory surgery division for $900 million

  Acquisition of Advanstar Communications Veronis Suhler Stevenson in its $1.14 billion acquisition of Advanstar Communications from DLJ Merchant Banking Partners III, a division of Credit Suisse Group

  Acquisition of General Nutrition Centers Ares Corporate Opportunities Fund and Ontario Teachers' Pension Plan Board in the $1.65 billion acquisition of General Nutrition Centers

  $33 Billion LBO of HCA Merrill Lynch Global Private Equity Group in the $33 billion leveraged buyout of HCA, Inc., the largest in history at the time

  Acquisition of $6.7 Billion Asset Manager A Circle Peak Capital-led investment group in the acquisition of the $6.7 billion asset management business of Morgan Keegan

  Billion-Dollar Telecom Sale Charterhouse Group as a majority shareholder in AAT Communications Corporation’s $1 billion sale to SBA Communications Corporation

  
  
  ....
  
  
  
  

  Leading Labor & Employment Lawyer Scott A. Faust Joins Proskauer ...

  Sep 7, 2010... Severstal, Noranda Alumina, Kaiser Aluminum, Harbinger Capital Partners,... He is the latest addition to Proskauer's Labor & Employment ...
  www.forbes.com/feeds/businesswire/.../businesswire144982507.html
  Leading Labor & Employment Lawyer Scott A. Faust Joins Proskauer - Connected To Harbinger Capital Partners
  
  
  Pages Has Been Dropped, Here is What it Said

  Leading Labor & Employment Lawyer Scott A. Faust Joins Proskauer

  Addition Continues Expansion of Global Labor & Employment Department, Enhances Boston Practice

  September 7, 2010 (Boston, MA) – Nationally recognized labor and employment lawyerScott A. Faust has joined Proskauer’s Boston office as a Partner in the Labor & Employment Law Department, enhancing the firm’s labor-management relations and employment law capabilities, and further fueling the department’s global expansion.

  Prior to joining Proskauer, Mr. Faust was co-Chair of the national labor and employment practice at McDermott Will & Emery LLP, where he represented employers in all aspects of traditional labor relations, including collective bargaining, grievance arbitration, mediation, union avoidance, proceedings before the National Labor Relations Board, strike preparation and management, strategic planning, and employment law. He also advises clients in connection with the labor and employment aspects of corporate transactions, including mergers and acquisitions, facility shutdowns and dispositions, reductions in force, Chapter 11 bankruptcy proceedings and other forms of corporate restructuring.
  
  Clients he has represented in recent years include Unilever, Severstal, Noranda Alumina, Kaiser Aluminum, Harbinger Capital Partners, DTE Energy Services, Millipore, Robert Half International, Gorton’s, and Boston’s Museum of Fine Arts, among many others. Mr. Faust received his bachelor’s degree from the University of Virginia and his law degree from Boston College Law School.

  He is the latest addition to Proskauer’s Labor & Employment Department, which, in recent months, welcomed former National Labor Relations Board General Counsel Ronald Meisburg, who practices in Washington, DC, and former Metropolitan Transit Authority Chief Labor Negotiator and executive Gary Dellaverson in New York. The firm also recently expanded its employment practice to London with the addition of Daniel Ornstein, established a Midwest presence with the addition of Nigel Telman in Chicago, and welcomed a group of pre-eminent employee benefit lawyers led by Paul M. Hamburger to its Washington, DC office.

  “Scott is one of the best and most well-recognized labor lawyers in the country. His experience, particularly in the manufacturing industry, including the steel and automotive sectors, will be an important strategic complement to what is already one of the country’s strongest and most effective labor and employment practices,” said Paul Salvatore, co-Chair of Proskauer’s Labor & Employment Law Department. “He is extremely well-rounded across a range of disciplines and is respected by both management and labor; his experience and insight will benefit us greatly as we continue to expand both in the U.S. and globally.”

  Mr. Faust is also the latest addition to Proskauer’s Boston office, joining Daniel Winslow, a former trial court judge and Chief Legal Counsel to Massachusetts Governor Mitt Romney and Scott Brown’s U.S. Senate campaign; Justin Daniels, an experienced patent litigator; and Charles Mokriski, who focuses on legal ethics and law firm practice issues.

  “Scott is the perfect addition to our Boston platform and truly emblematic of our strategy – a strong local presence balanced with a broad-ranging national practice. We look forward to his contributions,” said Steve Ellis, head of Proskauer’s Boston office.

  Consistently ranked in the top tier by Chambers USA and called “the 800-pound gorilla of labor relations” and “perhaps the most outstanding labor law firm in the country” by US Legal 500, Proskauer’s lawyers are recognized across the board as having a stellar reputation for labor matters and being among the best practitioners in the field. In addition to representing the National Football League, National Basketball Association, Major League Baseball and the National Hockey League in their ongoing, high-profile collective bargaining negotiations, Proskauer recently advised the Realty Advisory Board, which represents New York City’s building owners, in its contract negotiations with the city’s more than 30,000 apartment building workers, one of many such successful representations of management across the country.

  In addition to its labor and employment practice, Proskauer’s Boston office is home to one of the world’s top private investment funds practices, leading corporate finance and transactional groups, and preeminent patent law, intellectual property and litigation practices. "

  
  

  
  

  *****

  
  

  
  

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  MN - 2nd Annual Summit On Real Estate M&A Private Equity & REIT ...

  Sep 8, 2008 ... GOODWIN PROCTER, LLP. Keith Stein, Managing Director, HARBINGER CAPITAL PARTNERS FUNDS ... Steve Lichtenfeld, Partner, PROSKAUER ROSE LLP ...
  secure.imn.org › Division Home

"Falcone Buying Out Backer of Harbinger

Philip A. Falcone, the manager of Harbinger Capital Partners, is moving toward total control of his hedge fund.

Mr. Falcone is buying out Harbert Management, the firm that backed Harbinger’s start-up, the newsletter Hedge Fund Alert reports. Harbert, an alternative-investment manager based in Birmingham, Ala., acquired a stake in Mr. Falcone’s New York firm when it provided $25 million of seed capital for Harbinger’s first fund in 2001.

Mr. Falcone is buying back Harbert’s stake for an undisclosed sum, giving him 100 percent control of the firm.

Harbert will maintain its positions in Harbringer’s funds and will continue to provide operational support to the firm, Hedge Fund Alert reports.

Among its investments, Harbinger, along with Firebrand Partners, holds 19 percent of The New York Times Company’s stock."