TerraStar Cancels Bankruptcy Auction; Confirms Dish Network’s Winning Bid

[Satellite TODAY Insider 06-29-11] Satellite operator TerreStar has canceled its bankruptcy auction and declared Dish Network’s $1.375 billion acquisition offer the winning bid, according to bankruptcy court documents released June 28.
   Sources close to the auction confirmed to Satellite TODAY Insider that earlier reports claiming TerreStar had not received higher bids were true and that there was, “a lack of bidders interested in outbidding Dish Network.” The U.S. Bankruptcy Court of New York will need to approve Dish Network’s bid at a July 7 hearing for the acquisition to move forward. Court documents set a July 5 deadline for filing objections to the sale.
TerreStar Networks originally requested bankruptcy court approval to auction its assets in April, convincing a bankruptcy judge that the auction would urge its creditors to resolve their differences and come up with a viable alternative to a complete company sale.
   TerreStar Networks, which filed for Chapter 11 bankruptcy protection in October, said the auction also would maximize the value of the company based on acquisitions it has seen in its own market. "Dish Network Corp.’s $1.4 billion acquisition of bankrupt hybrid satellite and land-based communications company DBSD North America in March was an important data point in determining the market value of our own assets," TerreStar Networks said in the filing.

   TerreStar Corp., TerreStar Networks’ parent company, also filed for Chapter 11 bankruptcy protection in February. TerreStar and its 12-affiliate companies have amassed more than $1 billion of debt, with EchoStar as its largest secured creditor. 

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