- Sep 8, 2003
From our friends at SkyReport.com
Late Wednesday night, Loral Space and Communications said its board of directors rejected an offer for all of its assets from EchoStar.
Loral, which is in bankruptcy proceedings, said EchoStar indicated an interest in purchasing its assets for $1.85 billion. EchoStar's proposal was subject to numerous conditions, the company said.
In a statement, Loral Chairman Bernard Schwartz said, "EchoStar's bid undervalues Loral's businesses, especially in light of the significant increase in value that has been achieved since the beginning of the company's reorganization case in July. Our recent satellite awards demonstrate that Loral remains a trusted and valued business partner, providing the industry's most advanced and reliable satellites and satellite services."
An EchoStar spokesperson confirmed the company made a $1.85 billion offer for all of Loral's assets. The bid was conditional on the satisfactory completion of due diligence, the spokesperson said. The company also hasn't determined whether to participate further in the bidding process for Loral's assets.
Schwartz said the best course of action for Loral is to enhance the value of its assets, proceed with the proposed sale of its North American satellites and emerge from the bankruptcy process with a viable, ongoing satellite services and manufacturing business.
In July, Loral reached an agreement to sell Intelsat its six North American satellites - including the defunct Telstar 4, declared a total loss last month - for about $1.1 billion. The company said that consistent with bidding procedures approved by the bankruptcy court, it would evaluate all bids it may receive for its North American satellites on or before Oct. 15, including any bid from EchoStar if it submits one for those assets.