Intelsat’s Chapter 11 bankruptcy is likely to take between 6-12 months to process and allow the satellite operator to cut its $17 billion of debt by about half.
CCO Samer Halawi, talking to Space News, said that despite the bankruptcy procedure the operator was still able to order next-generation satellites because of the bankruptcy court’s ‘debtor in possession’ rules.
Intelsat was allowed to borrow an additional $1 billion in order to finance its obligations under the FCC’s planned spectrum auction later this year. The company must order new satellites and fund the conversion of its clients dishes and fit them with filters.
Intelsat is due to receive at least $4.86 billion as a result of the FCC’s C-band incentive scheme to fee up frequencies for 5G use.
However, one major shareholder in the company, Appaloosa, in a telephone hearing with the bankruptcy court and Judge Keith Phillips, argued that there were “massive” inter-company dealings between Intelsat and sister companies. These transactions needed to be investigated, said Appaloosa’s attorney Paul Basta.
Meanwhile, the Bankruptcy Court approved a request on May 15th to permit Intelsat to implement the C-band Clearance scheme, and to order equipment from suppliers related to the C-band plan.