US wireless broadband company LightSquared files for bankruptcy protection

Broadband wireless company LightSquared, which had ambitious plans to connect around 260 million US customers through satellite network, yesterday filed for bankruptcy protection after failing to reach a debt restructuring deal with its creditors.

The Reston, Virginia-based company said in a Chapter 11 filing in US Bankruptcy Court in Manhattan that it has assets of $4.48 billion and debt of $2.29 billion as of 29 February.

The company's biggest investor, Philip Falcone of New York-based hedge fund Harbinger Capital, said that the bankruptcy will enable the company to buy time, which was similarly echoed by LightSquared's CFO, Marc Montagner.

Bankruptcy ''is intended to give LightSquared sufficient breathing room to continue working through the regulatory process that will allow us to build our 4G wireless network,'' Montagner said in a statement.

LightSquared had ambitious plans of changing the wireless broadband sector in the US by providing 4G-LTE coverage to at least 260 million people in the US or 92 per cent of the US population that would yield American consumers $120 billion in benefits by 2015.

The company wanted to deploy an open wireless broadband network using the Long Term Evolution (LTE) technology, which would have combined with one of the largest commercial satellites ever launched, to provide coverage for the entire US.