satellite phone investment could soon face bankruptcy or liquidation, causing shares in both companies to fall sharply.

Motorola president Christopher Growney advised Wall Street analysts that it would not continue to invest in Bermuda-registered Iridium World Communications Ltd. unless other backers also helped in its rescue.

"With substantial participation of all significant parties, we believe Iridium LLC needs to, and can, deliver an achievable business plan based on the right financial restructuring solution,'' Growney said.

Executives of the communications equipment maker support the global phone venture, but they also must consider the interests of Motorola's stockholders, Growney said.

Credit Suisse First Boston immediately lowered its recommendation on Iridium World Communications Ltd. to sell from hold. Iridium's shares fell $1.433 , or 18 percent, to $6.75 on the Nasdaq Stock Market. Motorola's shares fell $1.621 to $95.871 on the New York Stock Exchange.

Motorola owns an 18 percent stake in Iridium, has backed loans and is producing handsets for the venture. Its total financial exposure is $2.2 billion.

Motorola has built reserves to cover part of any potential loss and Growney said Iridium's fate should have no impact on Motorola's earnings.

The company disclosed on Tuesday it had taken a $126 million second-quarter charge to profits to write down the value on Iridium bonds that have lost much of their value.

Other major Iridium investors include Lockheed Martin Corp., Raytheon Co., Sprint Corp. and American International Group Inc.

If an out-of-court restructuring does not take place in coming weeks, Iridium might be forced into Chapter 11 bankruptcy protection or liquidation, Growney said.