SES has dramatically turned up the heat in its increasingly acrimonious dispute with Intelsat over the division of the FCC’s ‘incentive’ payments for C-Band restructuring over the US. There will be a detailed court hearing on SES’s allegations in June.
Intelsat has already asked its bankruptcy court to ‘seal’ many of the documents, but SES, in guidance, says it has ‘whistleblower’ testimony from a former Intelsat staffer that will help prove that Intelsat’s management allegedly colluded cheating SES out of $450 million in the FCC’s C-Band award.
SES reminds those interested in the upcoming June trial that that it will contest Intelsat’s bankruptcy restructuring plan which it alleges is “unfair, anticompetitive, and designed to unfairly hurt SES, its primary competitor”. SES argues that Intelsat is trying to have the bankruptcy court approve a plan that blatantly shifts the proceeds from the multi-billion dollar spectrum clearing process away from SES.
SES stresses that it believes it has a “rock solid” claim against Intelsat which would amount to “millions of dollars” if not more than $1 billion.
The case documents – many of which Intelsat want to be sealed – include evidence of Intelsat’s alleged bad faith which is “overwhelming and shocking” says SES.
An SES guidance note on the case says it has “smoking gun” emails and testimony from a former Intelsat senior executive admitting that Intelsat breached its agreement with SES.
SES is arguing against the current Intelsat restructuring plan (as are certain former shareholders) saying that Intelsat has concocted a trumped-up exit plan that would strip almost all of the [company’s] value from Intelsat US [and into other US subsidiaries]. SES argues that the Intelsat exit plan and related disclosure statements do not adequately disclose the nature and amount of SES’s claim (including its likelihood of success), and it fails to disclose the likely impact on creditor recoveries if the SES claim is ultimately allowed at the Intelsat US level. SES is not alone in its displeasure. The US Trustee is also formally complaining to the bankruptcy court and saying that Intelsat’s Plan of Reorganisation, amongst other elements of the case, is inadequate and the timeline insufficient. Other objections have been lodged from certain Intelsat shareholders.
There is a planned hearing on April 14th.