Orbcomm Seeks Help Paying $170M Loan
Orbcomm Global said it has hired Donaldson, Lufkin & Jenrette Securities to help it figure out how to pay off a $170-million loan due in 2004, plus the interest.
The company, whose subsidiary Vantage Tracking Solutions pioneered truck trailer tracking, has cut half its workforce since the end of June and has significantly scaled back its in-house sales and marketing efforts. Parent companies Teleglobe Corp., a Montreal telecommunications firm, and Orbital Sciences of Herndon, Va., have both said they will not continue to provide funding to Orbcomm, which lost more than $140 million in 1999.
Orbcomm also has hired New York-based financial analyst Bear Stearns & Co. to help it find new investors.
The Dulles, Va.-based, low-earth-orbiting satellite firm also announced late Tuesday that it did not make an interest payment due that day on the loan. The payment is subject to an automatic 30-day grace period. And Orbcomm stated in a press release that the New York City-based financial advisor DLJ will assist Orbcomm in negotiations with creditors.
The press release added that DLJ will help Orbcomm explore “recapitalization alternatives with respect to its $170 million 14% Senior Notes due 2004.” An Orbcomm spokeswoman did not detail what those alternatives are, or specify what DLJ’s mission would be.
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