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NextWave, FCC eye deal
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September 21, 2001: 7:22 a.m. ET
Bankrupt wireless carrier may see $11B from resale of licenses
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NEW YORK (CNNfn) - NextWave Communications has entered a tentative agreement to sell its disputed wireless-spectrum licenses to other cellular phone companies for as much as $16 billion, according to published reports Friday.
Under the pending agreement, Hawthorne, N.Y.-based NextWave will pay the Federal Communications Commission $4.2 billion the company owes from its original purchase of the spectrums in 1996, which may also include several million in interest, according to The Wall Street Journal, citing sources close to the talks.
NextWave will then sell the licenses to some of the nation's largest carriers for $16 billion, resulting in a possible net of $11 billion for the bankrupt wireless firm, the paper reported.
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The proposed deal seeks to end a running dispute over the licenses after NextWave successfully bid $4.7 billion for the license in 1996 and then entered Chapter 11 bankruptcy protection with only $500 million paid to the FCC.
The FCC tried to reclaim the licenses and reauction them, but earlier this year an appeals court ruled the licenses belonged to NextWave. The FCC will drop its own appeal to the Supreme Court under the proposed settlement, according to the paper.
Despite the tentative deal, the Journal's sources said nothing is on paper and the tentative pact could still fall through.
Wireless providers involved in the sales are Verizon Wireless, a joint venture between Verizon Communication (VZ: Research, Estimates) and Vodafone Group (VOD: Research, Estimates), Dobson Communications (DCEL: Research, Estimates), Deutsche Telekom's (DT: Research, Estimates) VoiceStream Wireless, AT&T Wireless (AWE: Research, Estimates), and Cingular, a joint venture between Bellsouth (BLS: Research, Estimates) and SBC Communications (SBC: Research, Estimates), the paper reported.
NextWave is mostly owned by its employees, with investments from Bay Harbour Management and Cerberus Partners. 
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