MetroPCS (NASDAQ:PCS) is considering purchasing TerreStar Networks' assets in a deal that could be worth as much as $1 billion, according to a report in the Wall Street Journal.
The report, citing unnamed sources familiar with the matter, said the flat-rate carrier is among the parties interested in acquiring the satellite provider's assets but that a deal might not come together. MetroPCS is interested in gaining access to TerreStar's spectrum, which it could use for its nascent LTE network.
Representatives from MetroPCS and TerreStar declined to comment, the Journal said.
TerreStar, which is trying to launch an all-IP integrated satellite terrestrial network, filed for Chapter 11 bankruptcy protection in October. The company's parent, publicly traded TerreStar Corporation, did not file for bankruptcy. TerreStar Networks listed assets and debt each of more than $1 billion.
The report said right now it appears that EchoStar, TerreStar's largest creditor, is in the best position to win TerreStar's assets. EchoStar in October entered into an agreement with TerreStar to provide the satellite firm with a $75 million bankruptcy loan.
Final bids for TerreStar's business are due Jan. 24. TerreStar will default on the $75 million financing facility if a hearing to confirm its bankruptcy plan isn't held by Jan. 31 and confirmed by Feb. 14.
- see this Wall Street Journal article (sub. req.)
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