UPDATE:LightSquared's Ahuja Resigns As CEO In Management Shakeup
February 28 2012 - 3:48PM
Dow Jones News
LightSquared said its chief executive and an executive vice
president stepped down, part of a management shakeup after a
tumultuous period that has forced the multibillion-dollar wireless
venture to rethink its strategy about rolling out a new
fourth-generation network.
Sanjiv Ahuja left the CEO post this month after working without
a contract since July, according to people familiar with the
situation. Martin Harriman, the executive vice president of
ecosystem development and satellite business also left the company,
said one of the people. Ahuja will remain chairman and billionaire
Philip Falcone, whose Harbinger Capital Partners hedge fund is
LightSquared's principal backer, will join the board to assist in
the search for a new CEO.
LightSquared faces an uncertain future. The Federal
Communications Commission this month said it would revoke a waiver
that would allow the company to use satellite airwaves for a
terrestrial network because of concerns the network may interfere
with Global Positioning System signals.
The company has said it is the victim of biased testing and said
GPS device manufacturers should be required to pay for filters to
protect their equipment from signal interference. In the meantime,
it is considering a plan to swap its wireless airwaves, or
spectrum, with some held by the Defense Department as a last-ditch
effort to resolve the GPS interference concerns.
Chief Network Officer Doug Smith and Chief Financial Officer
Marc Montagner were named interim co-chief operating officers as
LightSquared undertakes the search for a new CEO.
A spokesman for LightSquared declined to comment on whom the
company was considering for the position.
Harbinger last year told investors that it lost 47% of the value
in its biggest fund because of a markdown in the value of
LightSquared. The losses helped cause Harbinger's firmwide assets
to plunge to $4 billion, from a high of $26 billion in 2008.
Investors have been barred from pulling their money from Harbinger
for months.
Harbinger, of New York, also is facing a lawsuit from investors
seeking a return of funds they lost as a result of the LightSquared
investment.
The company received the conditional FCC waiver last year and
hoped to compete with AT&T Inc. (T), Verizon Wireless and
others in selling spectrum wholesale to wireless carriers.
LightSquared has said it has enough money to operate for several
quarters, though it hasn't given specifics.
-By Greg Bensinger, Dow Jones Newswires; 212-416-4676;
greg.bensinger@dowjones.com
--Nathalie Tadena contributed to this article.
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