LightSquared has announced that it is officially filing for bankruptcy. The company had hinted that bankruptcy might be its next option in early April. The company has laid off many workers and still holds out hope that it might be able to resolve the concerns of US regulators who have so far blocked the wireless broadband network. The concerns about the LightSquared stem from harmful interference of its network with many GPS devices already on the market.
The company filed Chapter 11 bankruptcy yesterday in a U.S. Bankruptcy Court in Manhattan. As of February 29 of 2012, the company had $4.48 billion in assets and $2.29 billion in debt. As it became clear that the FCC was not going to approve the network, LightSquared started to lose backers and carriers. Despite bankruptcy, Falcone and the current management team will remain with the company according to a company spokesman.
LightSquared is still intent on launching the wireless 4G network. Falcone described bankruptcy filing as “necessary” to protect the company from creditors looking for a “quick profit.” The company was granted a second extension last week giving it an additional seven days to pay creditors. LightSquared’s Canadian and Bermudan affiliates also filed for bankruptcy.