Bifurcation Narrative

0022-EX-TU-2008 Text Documents

Inmarsat, Inc.

2009-03-04ELS_96574

March 4, 2009

BY ELECTRONIC FILING

Marlene H. Dortch, Secretary
Federal Communications Commission
445 12th Street, S.W.
Washington, D.C. 20554
Re: ITC-T/C-20080822-00397; SES-T/C-20080822-
01089; SES-T/C-20080822-01088; SAT-T/C-
20080822-00157; 0021-EX-TU-2008; File No.
0003540644; ISP-PDR-20080822-00016 (Transfer
of Control of SkyTerra Subsidiary LLC)
and
SES-STA-20080822-01085; 0022-EX-TU-2008
(Transfer of Control of Inmarsat Hawaii Inc.
and Inmarsat, Inc.)
Dear Ms. Dortch:

In the above-referenced applications, the parties have requested the
Commission’s consent to:

(i) transfer control of SkyTerra Subsidiary LLC (“SkyTerra Sub”), formerly
known as Mobile Satellite Ventures Subsidiary LLC, from SkyTerra
Communications, Inc. (“SkyTerra”), as it is currently controlled, to
Harbinger Capital Partners Funds (“Harbinger”), 1 and

(ii) transfer control of Inmarsat Hawaii Inc. and Inmarsat, Inc. from the
current shareholders of Inmarsat plc (“Inmarsat”) to Harbinger.

When these applications were first filed in August 2008, the parties requested
that the Commission process the applications as a group. Now, given the changes in
the financial markets and the need to maintain maximum flexibility in the approach to
acquiring control of both SkyTerra and Inmarsat, Harbinger and SkyTerra hereby
request that the Commission process these applications in two sets. The first set would

1These funds consist of Harbinger Capital Partners Master Fund I, Ltd. (“Master Fund”) and
Harbinger Capital Partners Special Situations Fund, L.P. (“Special Situations Fund”).

Marlene H. Dortch, Secretary
March 4, 2009
Page 2

consist of the applications proposing a transfer of control of SkyTerra Sub, including the
Petition for Declaratory Ruling accompanying the applications that addresses foreign
ownership issues. The second set would consist of the applications proposing a transfer
of control of Inmarsat Hawaii Inc. and Inmarsat, Inc. For the reasons discussed below,
it is respectfully requested that the Commission expedite processing of the applications
relating to the transfer of control of SkyTerra Sub.

As set forth in the Narrative that accompanied all of the transfer of control
applications, the SkyTerra and Inmarsat transactions are interrelated. Given that
interrelationship, the parties requested that the transfer of control applications be
processed as a group in the belief that this would be the most efficient way to proceed.
Since the filing made in August, 2008, however, changes in market conditions and
related corporate requirements necessitate expeditious action on the first part of the
overall transaction, i.e., the transfer of control of SkyTerra Sub. While it remains the
parties’ intent to proceed with both parts of the transaction, it is their hope that the
request for separate processing will facilitate expedited action on the SkyTerra
applications.

In furtherance of the request for separate processing, submitted herewith is a
separate Narrative addressing the public interest considerations associated with the
transfer of control of SkyTerra Sub. The previously-filed Narrative, the principal focus
of which was on the Inmarsat portion of the transaction, remains operative as to that
transaction. By separate letter, certain changes to the originally-filed Narrative are
being submitted that conform the Narrative to more current information that has been
filed in connection with a Petition for Declaratory Ruling. In addition, Harbinger and
SkyTerra are filing an amendment today revising the portion of the transfer of control
applications that describes the ownership of Harbinger.

Marlene H. Dortch, Secretary
March 4, 2009
Page 3

Please direct any questions regarding this submission to the undersigned.

Respectfully submitted,

/s/ Henry Goldberg /s/ Bruce D. Jacobs
____________________________ _______________________________________
Henry Goldberg Bruce D. Jacobs
Joseph A. Godles Pillsbury Winthrop Shaw Pittman LLP
Goldberg, Godles, Wiener & Wright 2300 N Street, N.W.
1229 19th Street, N.W. Washington, DC 20037-1122
Washington, DC 20036 Counsel for SkyTerra Communications, Inc.
Counsel for the
Harbinger Capital Partners Funds

cc: Jim Ball (FCC)
Howard Griboff (FCC)
Francis Gutierrez (FCC)
Susan O’Connell (FCC)
Neil Dellar (FCC)
Jodi Cooper (FCC)
Jennifer Balatan (FCC)

Before the
Federal Communications Commission
Washington, D.C. 20554

In the matter of )
)
SkyTerra Communications, Inc., ) File No. _____________________
Transferor, )
)
Harbinger Capital Partners Funds, )
Transferee, )
)
Applications for Authority to Transfer Control of )
SkyTerra Subsidiary LLC )
)

NARRATIVE

Before the
Federal Communications Commission
Washington, D.C. 20554

In the matter of )
)
SkyTerra Communications, Inc., ) File No. _____________________
Transferor, )
)
Harbinger Capital Partners Funds, )
Transferee, )
)
Applications for Authority to Transfer Control of )
SkyTerra Subsidiary LLC )
)

NARRATIVE

Applications were previously filed requesting the Commission’s consent to:

(i) transfer control of SkyTerra Subsidiary LLC (“SkyTerra Sub”), formerly

known as Mobile Satellite Ventures Subsidiary LLC, 1 from SkyTerra Communications,

Inc. (“SkyTerra”), as it is currently controlled, to Harbinger Capital Partners Funds

(“Harbinger”), and

(ii) transfer control of Inmarsat Hawaii Inc. and Inmarsat, Inc. from the

current shareholders of Inmarsat plc (“Inmarsat”) to Harbinger.

The parties requested that these applications be processed as a group, and a single,

integrated narrative was submitted with the applications. Now, however, Harbinger and

SkyTerra are requesting separate processing of the Skyterra transfer of control

applications and the Inmarsat transfer of control applications. For the convenience of the

Commission and interested partes given these changed circumstances, a revised version

1
The company names used in this letter and the accompanying attachment and appendices reflect
the fact that various subsidiaries of SkyTerra Communications recently changed their names by
replacing “MSV” in the company name with “SkyTerra.”

-2-

of the portions of the narrative addressing compliance with Communications Act

requirements, compliance with Commission requirements, and public interest factors, in

all cases now limited to considerations affecting the proposed transfer of control of

SkyTerra, is provided below. Basic information concerning the SkyTerra transaction, the

parties to the transaction, and the legal standards governing consideration of the SkyTerra

transfer of control applications can continue to be found in the originally-filed narrative,

the pertinent portions of which are hereby incorporated by reference.

THE PROPOSED TRANSACTION COMPLIES WITH THE
COMMUNICATIONS ACT AND THE COMMISSION’S
RULES, AND PROMOTES RATHER THAN HARMS THE
PUBLIC INTEREST

SkyTerra already holds a controlling interest in SkyTerra Sub, which has been

approved by the Commission. 2 The FCC qualifications of SkyTerra as presently owned,

therefore, are a matter of public record. The qualifications of Harbinger are set forth in

the applications with which this Narrative is associated, which are listed in Attachment A

hereto, and in the Declaratory Ruling Petition discussed below.

Certain FCC authorizations held by SkyTerra Sub are common carrier radio

licenses that are subject to the foreign ownership limits of Section 310(b)(4) of the

Communications Act. In connection with these common carrier licenses, the

Commission has granted Harbinger interim authority pursuant to Section 310(b)(4) to

hold a non-controlling interest of up to 49.99 percent equity and voting interests in

2
In the Matter of Motient Corporation and Subsidiaries, Transferors, and SkyTerra
Communications, Inc., Transferee, Application for Authority to Transfer Control of Mobile
Satellite Ventures Subsidiary LLC, Memorandum Opinion and Order and Declaratory Ruling, 21
FCC Rcd 10198 (2006).

-3-

SkyTerra. 3 This interim authority is subject to Commission action upon a pending

petition for a declaratory ruling seeking the same authority on a permanent basis. 4

Attachment B hereto is a new petition for declaratory ruling (the “Declaratory Ruling

Petition”) seeking authority pursuant to Section 310(b)(4) for Harbinger to hold interests

in SkyTerra in excess of the 49.99 percent equity and voting interests that are presently

authorized on an interim basis.

Subject to a favorable Commission ruling on the Declaratory Ruling Petition, the

proposed transfer of control will be in conformity with all applicable provisions of the

Communications Act and the Commission’s rules.

The proposed transactions raise no national security or law enforcement concerns.

SkyTerra Sub and SkyTerra have a long history of cooperating with the United States

government on issues of national security, and under Harbinger and Sky Terra’s control,

the parties will continue to do so. The parties understand the importance of Executive

Branch concurrence that matters of national security and law enforcement will not be

compromised by the proposed transactions and the deference the Commission gives to

such agencies relative to the same. 5 The parties intend forthwith to initiate discussions

with Executive Branch agencies with respect to the proposed transactions and have every

expectation that they will be able to satisfy any concerns that these agencies may raise.

3
In the Matter of Mobile Satellite Ventures Subsidiary LLC and SkyTerra Communications, Inc.;
Petition for Declaratory Ruling under Section 310(b) of the Communications Act of 1934, as
Amended; Harbinger Capital Partners Master Fund I, Ltd. and Harbinger Capital Partners
Special Situations Fund, L.P.; Petition for Expedited Action for Declaratory Ruling under Section
310(b) of the Communications Act, as Amended, Order and Declaratory Ruling, 2008 FCC Lexis
2181 (rel. March 7, 2008).
4
Id. at 2008 FCC Lexis *28.
5
See Rules and Policies on Foreign Participation in the U.S. Telecommunications Market,
Report and Order and Order on Reconsideration, 12 FCC Rcd 23891, 23919-21 (1997).

-4-

The proposed transaction serves the public interest. The proposed transaction

does not adversely affect the competitive landscape or the broader goals of the

Communications Act in any way. Instead, the proposed transfer of control will allow the

applicants to conduct their operations more efficiently and effectively, thereby assisting

applicants’ efforts to deploy its next-generation satellite and integrated satellite-terrestrial

network. Harbinger’s earlier investments in SkyTerra enabled the latter to go forward

with its plans to launch its SkyTerra -1 and SkyTerra -2 satellites. Harbinger’s continued

investment, and acquisition of a majority stake in SkyTerra Sub, will bring its resources

and financial acumen to bear to enable SkyTerra to bring to market advanced services

that promise to ring in the era of integrated satellite-terrestrial networks and extend the

marketplace for satellite services far beyond their historical bounds.

CONCLUSION

For the foregoing reasons, Commission consent to the transfer of control of

SkyTerra Sub to Harbinger is hereby requested.

Document Created: 2009-03-04 17:14:10
Document Modified: 2009-03-04 17:14:10

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