PanAmSat Seeks to Stop Purchase of Comsat

PanAmSat Corp., the world’s largest commercial-satellite operator, urged federal regulators to block Lockheed Martin Corp.’s plan to buy Comsat Corp. The Federal Communications Commission should reject the proposed $2.7-billion transaction because Comsat, created by the federal government and a competitor of PanAmSat, is the sole organization that can sell services of Intelsat, a global satellite organization, in the U.S., PanAmSat said. PanAmSat also objects to Lockheed purchasing more than 10% of Comsat’s stock. Current law forbids Comsat from selling more than 10% of its voting stock to anyone other than a phone company, or common carrier. “Lockheed Martin’s bid to classify itself as a common carrier to buy 49% of Comsat and take effective control of the company is a sham and an attempt to cut Congress out of the policy debate,” PanAmSat general counsel James Cuminale said. PanAmSat’s objection “was not unexpected,” said Lockheed Martin spokesman Charles Manor. “The goodness of this deal will be abundantly clear to regulators in the weeks and months to come,” he said. Satellite-maker Lockheed expects to bolster its fledgling business of providing satellite transmission services just as that market is poised to reach $120 billion in 2002 from about $50 billion now.