US wireless network operator LightSquared has failed to stump up a payment due to global mobile satellite communications services provider Inmarsat.
The two companies have a co-operation agreement, under which LightSquared has been making a series of scheduled payments to Inmarsat in line with contractual milestones but according to the satellite company the payment of $56.25m from LightSquared which became due upon the completion of the "Phase 1 transition" has not been received.
Inmarsat has issued a notice of default to LightSquared under the co-operation agreement which gives 60 calendar days for LightSquared to cough up the cash, otherwise Inmarsat will be entitled to enforce its rights and remedies under the agreement for payment default, including pre-agreed spectrum arrangements and termination of certain LightSquared rights.
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Inmarsat and LightSquared are talking about the future of co-operation agreement, but Inmarsat said it cannot provide any assurance that these discussions will result in any further payments being received from LightSquared.
On the plus side, the revenue generation of Inmarsat's core mobile satellite services and Inmarsat Solutions businesses remains unaffected by the LightSquared situation.
Shares in Inmarsat slipped 5.6p to 477p in a rising market following the news of LightSquared's default.
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