Our predictions dating back to last October were further validated when Newsat entered Chapter 15 last week.
Our man in space tells us that an easy resolution is not expected. Firstly, Newsat’s “8 slots” are valueless because they are low priority. For this reason Newsat was forced to buy very limited Ka band spectrum rights from Measat, and in return funded a Ku band payload and gave it to Measat.
So Measat holds the cards – it would be tough to repurpose the satellite to operate in a different location and Measat apparently has certain other rights over Newsat, so any deal will HAVE to involve Measat – who are savvy folk and therefore will not be offering much financial support! The Ka band payload is, we are told “super weird” because it does not use all of the spectrum used by conventional systems meaning that low cost modems won’t work.
Finally, with debt claims on the company (including the costs of completion) of around $400m, it is speculated that the project is not even worth that, let alone the equity injected. So EXIM and COFACE are going to have to take a bath – that’s not easy for them to do. No-one is going to buy a Company that is currently being sued by all and sundry. Apparently champagne-glugging yacht fan CEO Adrian Ballintine showed up at the Washington Satellite show last month and spent the days in the lobby being ignored by all and sundry – clearly too hot to handle.
So the assets will have to be stripped out, a messy process in general and only something that can happen once the whole company is bankrupted and EXIM and COFACE have nowhere else to go. There will not be a big market for this one.