Former PanAm CEO tries to revive Iridium

By : |October 31, 2000 0

Cats have nine lives. Iridium appears to have several more. Already having
been on the losing end of a dozen or more rescue attempts, and several court
orders to send its constellation of 66 satellites crashing back into the Earth’s
atmosphere, there may yet be some life left in Iridium.

A new group of investors, headed by Dan Colussy, the former CEO of the
defunct Pan American World Airways, has offered $25 million to take over the $6
billion communications network. Reportedly, aerospace company Boeing would
operate the system.

A court hearing at which the latest offer will be reviewed by the US
Bankruptcy Court of New York, is scheduled for November 8. Keeping the Iridium
system in orbit is costing Motorola some $10 million a month. The Colussy deal
would relieve the company of that burden.

Colussy’s newly organized company, Iridium Satellite LLC, has offered $6.5
million in cash, $18.5 million in convertible debt securities providing for
deferred cash payments and a 5 per cent equity stake in the new company. Boeing
is not investing any equity in the project and would strictly operate the system
as a paid service provider to the new owners.

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