Iridium Suitors Outline Competing Offers

Cellular telephone pioneer Craig McCaw is taking a new approach in his bid for Iridium, proposing to buy the satellite phone company via a bankruptcy court auction instead of trying to settle with creditors. McCaw’s Eagle River Investments and Motorola Inc. have dropped a plan to provide $74.6 million in financing for the Washington-based Iridium while attempting to work out an agreement with creditors that would let them buy the bankrupt company. Instead, Eagle River and Motorola will provide $5 million in interim financing while Iridium moves in U.S. Bankruptcy Court to auction its assets to the highest bidder, an attorney for Iridium said. At a hearing in U.S. Bankruptcy Court in Manhattan, Judge Cornelius Blackshear approved the temporary funding through March 6 and set a hearing on the auction proposal for March 3. McCaw’s investment group, which includes Motorola, last week offered $600 million for Iridium. Iridium’s bondholders objected to the plan, which would likely have paid them nothing. At the same hearing, a possible alternative bidder for Iridium emerged. Attorney Neil Forrest said his client, Crescent Communications Inc. Chief Executive Gene Curcio, has lined up backing from “some wealthy Middle East investors.” In an interview, Curcio said he’s prepared to top McCaw’s $600 million offer. He declined to specify his funding source.