Globalstar exists bankruptcy
http://www.globalstar.com

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Globalstar coverage map
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Mobile satellite communications service Globalstar has announced that it has completed its financial restructuring, following the acquisition of business operations and assets by Thermo Capital Partners LLC. This will lead the company out of Chapter 11 bankruptcy where it has been since Feb 2002. 

Thermo now owns 81.25 per cent of Globalstar in exchange for an investment of $43m, with the remainder of equity to be distributed to the creditors of the original Globalstar company. The company is now debt free and has around 200 employees. 

"We will be spending a multiple of $43m in rebuilding this business," says Jim Lynch, managing director of Thermo.  "We have additional $250m on the sideline." 

Thermo expects Globalstar to record at least 70% year-over-year growth in 2004 and to be operationally profitable by the fourth quarter of this year.

Globalstar has also taken ownership of the France gateway (previously owned by Alcatel and France Telecom). 

"For the moment, our sales and marketing efforts in Europe have been a bit limited....but we've been waiting to get out of bankruptcy to allow us to clear the decks and get our European business growing again," says spokesperson Mac Jeffery. 

"Despite its slow start, Globalstar - now in its fifth year of uninterrupted service - is by far the best positioned, with the best technology, to take advantage of the opportunities in the mobile satellite market, by increasing our attention on Globalstar's customers and their communication needs," says Jim Lynch, managing director of Thermo.  


SUBHEAD
Growth plans 

There are plans to launch the 8 spare satellites Globalstar currently has on the ground, putting them in orbit in late 2005 or 2006. 

There will be a new Globalstar gateway in Florida to be constructed during 2004. It is also expanding capacity and coverage from its existing gateway in Puerto Rico with the installation of a fourth antenna. 

Work has proceeded on site selection for a Globalstar gateway in Alaska to serve the entire state of Alaska and offshore regions. 

Globalstar anticipates that much of its growth will be in data services, rather than voice.

"Data is the future of this company," says Jay Monroe, also a managing director of Thermo Capital Partners. "Data can be sliced and diced a few ways, connections to the internet - all of this data is important to us. Without a doubt it is the future of this company."

Data services will be developed for specific industries such as maritime, homeland security, oil and gas extraction and transport. New data services are also under development, with a new data compression service scheduled for commercial launch in the weeks ahead. The company will launch fax capability later this month. 

The costs of airtime and equipment are currently under review, with announcements anticipated shortly. 


SUBHEAD
Sales 

President Tony Lavarra describes Globalstar as essentially a "sales organisation" - focussing on maritime, natural resources (eg forestry, oil) and government services. It anticipates special growth in the areas of security and asset tracking.

The dealer network will be maintained as "an absolutely critical" part of the business, Mr Lavarra says.

Mr Lavarra notes that the company never stopped offering services during its entire restructuring service; indeed, during the period Feb 2002, when it entered Chapter 11, until April 2002, when it left, the company tripled the number of subscribers from 36,000 to 100,000. 

"If we can do this while we're in Chapter 11 Just imagine what we can do now we're out of it," he said. 

Agreements with operators of the land satellite stations around the world are being renegotiated - they will be able to bill and provide customer care. 


SUBHEAD
Coverage

Globalstar has 40 low earth satellites at 1,414km orbit. The calls are bounced directly from the mobile station (eg ship), up to the satellite and down to the earth station (rather than handed from one satellite to another as with the Iridium system).

The satellite altitude means that the service only works when the mobile station is within around 3,000 km from an earth station, which is a critical fact for the maritime industry.

Coverage is currently available for most of the Northern hemisphere including around 60 per cent of the North Atlantic, the entire Mediterranean and coastal waters in the US and Japan. In the Southern hemisphere coverage is limited to around South America and Australia.