TerreStar Units File Chapter 11
TerreStar said its majority-owned Terrestar Networks unit and certain other affiliates have filed for protection from creditors under Chapter 11 of the Federal Bankruptcy Code.
Earlier this week, the Wall Street Journal reported that a Chapter 11 filing likely was imminent.
“Through the restructuring, TerreStar Networks hopes to lessen its debt obligations in order to place greater focus on delivering the future of ‘always available’ mobile communications through its recent launch of the world’s first integrated satellite-cellular smartphone,” the company said.
The company also said it signed an agreement to receive $75 million of debtor-in-possession financing with EchoStar, its largest secured creditor.
