Pentagon Moves to Keep Iridium Satellites Aloft
W A S H I N G T O N, Dec. 7 -- The U.S. Defense Department said it was stepping in to prevent $5 billion worth of Iridium communications satellites from falling toEarth and triggering possible “widespread anxiety.”
Staving off a fiery end to the 66-satellite necklace andits spares, the Pentagon on Wednesday awarded a projected two-year, $72million communications contract to seal a new ownership dealworked out in a New York bankruptcy court.
The new owners, led by Dan Colussy, president of PanAmerican World Airways from 1978 to 1980, have contracted withBoeing Co. to take over operation of the system fromelectronics giant Motorola Inc., Pentagon officials said.
For months, Motorola had been preparing a 14-monthcontrolled “de-orbiting” and destruction of the network in theabsence of a qualified buyer for the bankrupt satellitetelephone company it bankrolled.
Colussy’s venture capital start-up, Iridium Satellite LLC,won conditional court approval Nov. 22 to buy the operatingassets of the bankrupt company — a victim of weak sales, highoperating costs and technical glitches.
The Pentagon contract was a “precondition” for finalapproval of the asset transfer at the bargain-basement price of$25 million, a representative of the new owners said.
“We expect the closing of the sale to take place within amatter of days,” said Ginger Washburn, chief marketing officerof the new Arnold, Md.-based company.
The new owners will market their services to commercialusers as well as to the U.S. military and other governmentusers. The State Department already owns 2,000 Iridium handsetsfor use in remote spots on humanitarian missions.
Rescue Prompted by Growing Need
The Pentagon said it was rescuing Iridium because of agrowing need for the encrypted services that will be madepossible through a special “sleeve” outfitted for securehandsets.
The Pentagon already owns about 1,600 Iridium satellitephones. It will get unlimited air time for up to 20,000government users for $3 million a month under the deal.
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