LONDON (Reuters) - Telecommunications pioneer Craig McCaw will lead a group of international investors that will provide up to $1.2 billion to rescue satellite phone venture ICO Global Communications Ltd, ICO said Monday.
In a deal agreed Sunday, McCaw and his affiliates Teledesic LLC and Eagle River Investments LLC will lead a group of existing investors in ICO, which filed for bankruptcy last August, to provide $225 million in interim finance.
This financing, expected to be completed by November 8, will be followed by $275 million in a second round by the end of January 2000. This interim, debtor-in-possession, financing would be converted to equity when the company emerges from bankruptcy.
McCaw and his affiliates will also underwrite the remaining $700 million of exit finance, expected to be completed by second quarter 2000, with existing and additional investors invited to participate in this remaining portion of financing.
McCaw, whose Teledesic is building a global broadband Internet-in-the-sky satellite communications network, said, ``It is our hope that by working with ICO's team and international partners we can bring the company back to good health and make a contribution to global communications, particularly in the developing world.''
``Our investment in ICO marks the first step in our strategy to widen the technological tools at our disposal and serve a broader group of customers,'' he said in a statement.
The McCaw-led investment will enable ICO to raise the $1.2 billion it needs to complete the build-out of its system and to provide working capital up to the launch of its global mobile satellite services in the second quarter of 2001.
``ICO's future just got brighter. This financing agreement provides us with a clear path to exit from Chapter 11,'' ICO's chief executive officer, Richard Greco, said.
ICO shares were suspended on Nasdaq on August 27 when it filed for Chapter 11 protection.
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