[Satellite TODAY 08-18-10] LightSquared has triggered a cooperation agreement signed with Inmarsat more than two years ago to acquire spectrum for LightSquared’s planned 4G-LTE satellite and mobile broadband network, the companies announced Aug. 18.
     Under the agreement, signed in December 2007 between Inmarsat and SkyTerra, which is now LightSquared, the companies designed a phased plan to re-band and reuse L-band spectrum covering North America. The agreement was designed to increase the contiguous spectrum available to support the deployment of 4G ancillary terrestrial component services and protect the continued deployment and growth of MSS activities in North America.
     Under Phase 1, Inmarsat will implement a modified spectrum plan over a period of 18 months. LightSquared will make a series of payments to Inmarsat totalling $337.5 million and has made the initial payment of $81.25 million. LightSquared will make five payments of $40 million every three months until, with the final installment slated for 15 five months after the Phase 1 trigger date. Upon completion of the first phase, LightSquared will pay another $56.25 million.
     LightSquared also has an option to implement Phase 2 which will add further capacity to its network. Phase 2 may be exercised at any time through Jan. 1, 2013, and provides that Inmarsat would make additional spectrum available at an annual cost of $115 million per year. The Phase 2 process is expected to take 30 months once the option is exercised.
     “Implementation of this agreement represents a significant milestone in LightSquared’s plan to build the nation’s first wholesale only 4G-LTE wireless broadband network,” Sanjiv Ahuja, chairman and CEO of LightSquared, said in a statement. “Triggering this agreement will now give us the contiguous spectrum we need to support additional network capacity to meet the growing demand for wireless data.”
     LightSquared is the result of an eight-year, $7 billion joint venture announced in July between Harbinger Capital Partners and Nokia Siemens Networks to build and operate a 4G-LTE satellite and mobile broadband network for wireless providers. LightSquared will rely on satellites and terrestrial spectrum that Harbinger acquired through its $280 million purchase of SkyTerra in March. LightSquared plans to launch in its first markets by the middle of 2011 and aims to provide coverage to 92 percent of the United States by 2015. The company will raise up to $1.75 billion in debt and equity before service launch.