Centerbridge Partners Drops $3.3 Bln Bid To Buy LightSquared: Reports

(RTTNews) - Private equity firm Centerbridge Partners LP has backed out of its $3.3 billion tentative deal to buy wireless-telecommunications firm LightSquared Inc. out of bankruptcy, media reported Tuesday. Meanwhile, LightSquared reportedly is exploring a similarly structured deal with others.

On December 11, the Wall Street Journal reported, citing people familiar with the matter, that Centerbridge has reached a deal to buy LightSquared, aiming to upstage the efforts of Dish Network Corp. (DISH) to take over LightSquared.

In its move, Centerbridge was supported by Fortress Investment Group LLC (FIG) - a LightSquared investor, J.P. Morgan and Harbinger Capital. Fortress Investment had once planned to make an offer for LightSquared, the wireless venture founded by financier Philip Falcone.

Centerbridge has proposed to pay $3.3 billion for LightSquared, and assume about $1.7 billion in liabilities. The deal would have executed under a bankruptcy-reorganization plan.

LightSquared seeks to develop a wholesale 4G LTE wireless broadband communications network integrated with satellite coverage.

LightSquared's main asset is spectrum or airwaves needed for telecommunications firms to operate wireless network. It is believed that owning spectrum will be valuable as demand shoots up for high-speed cellphone and mobile Internet service.

LightSquared filed for bankruptcy protection in May 2012 after regulators blocked its plan to proceed with the network, saying its spectrum interfered with global positioning systems.

Dish, which looks to enter the wireless industry as part of its diversification, had earlier this year offered $2.2 billion for LightSquared. Its offer served as an opening offer for a bankruptcy auction scheduled for Wednesday which could later be topped. However, that auction was canceled.