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West Palm Beach (HedgeCo.net) - Satellite communications company Intelsat is launching a joint venture with a South African alternative investor group led by Convergence Partners.
The joint venture plans to finance, build and launch a new satellite, Intelsat New Dawn, featuring a payload optimized to deliver wireless back haul, broadband and television programming to the continent of Africa, it is expected to enter service in early 2011.
The group recently concluded agreements for financing of the project, which is expected to cost around $250 million. The project is to be funded approximately 15% with equity and 85% with debt, the debt being in the form of non-recourse project financing provided by African institutions. Pre-orders for satellite capacity currently total more than $350 million, with some contracts for up to 15 years of service on the satellite.
"Today marks an important milestone in the development of Africa’s infrastructure," Andile Ngcaba, Chairman of Convergence Partners said, "The New Dawn joint venture, with its optimized satellite and African-led financing, represents a solution for Africa by Africa. Over the course of this satellites life, it will provide world-class connectivity, allowing businesses to grow and rural communities to connect. Convergence Partners believes that investments in African projects of this nature can offer superior returns while also accelerating the socio-economic development of the continent."
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New York (HedgeCo.Net) - Hedge Fund Appaloosa Management may have tried to turn their back on Delphi, but somehow they just can’t seem to get away. Ensnarled in a nasty court battle with the Michigan auto parts supplier, the judge is now reconsidering original fraud claims brought against the New Jersey based hedge fund.
Delphi had sued the investor group headed by Appaloosa that originally agreed to inject $2.55 billion into the bankrupt company that was supposed to help lift them out of Chapter 11. The investors commitment was going to provide a much needed piece of the $6.1 billion in financing that Delphi needed to secure by the April deadline. When Appaloosa walked away as the deadline neared, Delphi was left scrambling, clinging only to former parent company General Motors.
Judge Robert Drain told a Manhattan Court this week “It seems to me that I was unclear in what aspects of the allegations needed to be dealt with…I may have well been wrong.”
Drain said that when he dismissed this claim for fraud originally, he did not feel that Appaloosa made “affirmative misrepresentations” to Delphi about plans to scrap the financing deal. Now, Drain is reconsidering, saying that any failures to communicate a change of mind could very well constitute fraud.
Both parties were asked to gather more information and submit briefs on the fraud claim by the next hearing on October 21. Delphi is seeking damages from Appaloosa and a ruling that could make them deliver their original financial obligation.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
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Reuters- U.S. railroad CSX Corp, locked in a proxy battle with two hedge funds, urged shareholders in a letter on Tuesday to vote against the activist investor group’s proposed slate of five directors, saying they had "no plan" for the company.
"The TCI Group, which is promoting a slate of five new directors for the CSX board, has no plan and no new ideas for the company," wrote Michael Ward, chairman and chief executive of Jacksonville, Florida-based CSX. "They’ve made demands that we believe would damage CSX and impair the value of your investment — ideas such as saddling CSX with ‘junk’-rated debt or doing a leveraged buyout at $50 a share, with the stock price now in the high $60s."
Reuters - A federal jury in Atlanta on Wednesday convicted former hedge fund manager Kirk Wright on charges of scamming investors, including former professional athletes, out of $150 million, the Justice Department said.
Kirk was found guilty on charges of mail fraud, securities fraud and money laundering relating to the 2006 collapse of his Atlanta-based investment firm, International Management Associates (IMA), the Justice Department said.
IMA also had offices in New York, Los Angeles and Las Vegas and thousands of clients. Evidence presented in his two-week trial showed Wright had been lying to investors since 2001 about investment performance and their account balances, the Justice Department said.
The government presented as evidence fabricated records and material showing he diverted investors’ money for personal use, including cash for himself and family members, luxury cars, jewelry, house renovations and a $500,000 wedding.
IMA collapsed in 2006, after several investors requested distribution, received bad checks and filed lawsuits. The investor group included several former National Football League players who were among victims who testified at the trial.
"A measure of justice was served today for the hundreds of investor-victims in the stunning collapse of International Management Associates," U.S. Attorney David Nahmias said. "Those victims poured more than $150 million into Wright’s hedge funds over the years, only to find in 2006 that the money was gone and that Wright had lied to them for years."
Wright could receive a sentence of up to 710 years in prison, a fine of up to $16 million and restitution for victims’ loses. He remains in custody and is scheduled for sentencing on Aug. 26.