A group of satellite technology experts, military officials and debt and operational restructuring professionals have submitted a proposal to acquire the assets of Iridium L.L.C. for $61 million, but according to Iridium, their bid is just another in a series of offers that have been piling up since the company terminated service in March.
If Minneapolis-based IR Acquisition Group succeeds in acquiring Iridium’s assets, it plans to use the satellite constellation to provide service for “natural remote area” users such as oil-rig workers, the U.S. government and as back-up service to commercial cellular communications, said Carl George, chairman and chief executive officer of IR Acquisition Group.
Bob Barry, spokesman for Iridium, said he doubted IR Acquisition Group would be the ultimate winner.
“There are only a very few who have been able to clearly show they have the money available and skills and technical competence” to legitimately pull Iridium out of trouble, Barry said. “Many would like to use it (Iridium’s satellite constellation) for data, but it is not very suitable for that … “
George pointed to IR Acquisition Group’s “large reputations, resumes and wherewithal” as qualities that speak to the group’s earnest interest in acquiring the failed satellite company. The group’s financing comes from internal sources, and it also has established operating banking facilities in case it wins.
“The offer is very legitimate. It’s based upon what we were able to assess and ascertain,” George said.
Despite many requests, obtaining information about and establishing a cooperative relationship with Iridium has been extremely difficult, said George, who attributes much of Iridium’s reluctance to cooperate to overwhelming interest in the company.
“Dealing with Iridium has been described as dreadful. I think they have `deal fatigue.’ They have been approached by every possible corporation in the last nine months. But I think they believe they could dictate the terms that someone could acquire them on, and I think they still think they can,” said George.
There is much more riding on the salvation of Iridium’s satellites than just millions in infrastructure and technology, George said, and letting the equipment disintegrate in the earth’s atmosphere has more far-reaching implications.
“We think it would be a national tragedy,” he said. “I also think it tarnishes the reputation of the U.S. technological leadership.”
Iridium’s demise has instilled doubt in the minds of investors, industry analysts and the public as to the legitimacy and practicality of the technology. Globalstar Telecommunications Ltd., the only mobile satellite communications company in commercial operation, told RCR in April that Iridium has “really spooked people,” and Globalstar was “paying for its (Iridium’s) sins.”
Previous reports said Iridium’s satellite constellation was in the process of de-orbiting, but according to George, “The constellation is in orbit and being maintained, and they have taken off all the customers, with the exception of the U.S. military.”
George said he is uncertain when Iridium might hand down a decision on who will acquire the company or how it plans to proceed.
