- The Washington Times - Wednesday, December 17, 2003

The federal government yesterday gave international satellite network Intelsat Ltd. another six months to hold an initial public offering of its stock that could raise $1 billion.

It is the second time Intelsat, which is based in Bermuda and has its operations in the District, has been allowed to delay its stock sale.

Intelsat now has until June 30 to hold an initial public offering, and it plans to sell a 20 percent stake in the company.

Intelsat Chief Executive Officer Conny Kullman said the company plans to meet the guidelines that require it to sell shares next year.

The company earned approval to delay the stock sale from the Federal Communications Commission, which warned that it is not likely to give Intelsat another extension.

Intelsat was founded in 1964 and was privatized in July 2001. A federal law that outlines the conditions of Intelsat’s move from a private company to a public one stipulated that it must hold the stock sale by Oct. 31, 2001. A congressional amendment extended the deadline to Dec. 31, 2003, and gave the FCC authority to extend the deadline again.

The FCC said in its order yesterday it has “serious concerns” that a weak market for initial public offerings would not help the company raise the money it hopes to raise.

Merrill Lynch and Co., which serves as a financial adviser to Intelsat, has said the company’s offering of stock would raise more than $1 billion, but there have been no IPOs in excess of $1 billion in 2003.

Morgan Stanley, another company serving as a financial adviser, said no U.S. media or telecommunications company has raised $1 billion in an initial public offering of stock since 2000, according to documents filed with the FCC by Intelsat.

Intelsat also argued in documents filed in August with the FCC that it doesn’t want to hold the initial public offering until it closes its $1.1 billion purchase of five satellites from bankrupt firm Loral Space and Communications Ltd.

A bankruptcy court approved the deal between the two companies on Oct. 24, and the sale is expected to close by early next year, according to regulatory filings.


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