Log In

Reset Password

Globalstar gets approval to resume satellite launches from Kazakhstan

NEW YORK -- Bermuda-registered Satellite telecommunications company Globalstar Telecommunications Ltd. said yesterday it won approval to resume launching satellites from Kazakhstan, which will allow it to have 32 satellites in orbit by the summer and to begin commercial service in September.

Globalstar's previous launch schedule was derailed in September, after the company lost 12 satellites worth $180 million during a launch failure in Kazakhstan.

Globalstar said it won permission to resume launches after the United States, Kazakhstan and Russia signed an agreement governing the conditions under which US satellites can be launched from Baikonur, Kazakhstan.

Globalstar will use a satellite network to provide people around the world with fixed-phone and hand-held mobile satellite phone services, as well as data transmission, paging, facsimile service and position location services.

Globalstar said it will launch four satellites roughly every 30 days, beginning by or before mid-February, and will have 32 satellites in orbit by the summer.

Globalstar has been conducting tests since April 1998 using its existing eight satellites and expects to begin commercial services in the third quarter of 1999 using the 32-satellite network. A total of 52 satellites, including four spares, will be in orbit by December.

Shares of Globalstar jumped 8 percent or $1.56 to $19.625 in yesterday's afternoon trading on Nasdaq.

Some analysts said the new launch schedule seem aggressive, but the news of the launch approval helped eliminate some uncertainty weighing on the stock.

SoundView Financial Group analyst Tim O'Neil said he reiterated a buy rating on Globalstar's stock.

Globalstar, led by founding partner Loral Space & Communications Ltd., is a partnership of several leading telecommunications companies and equipment manufacturers including Qualcomm Inc., AirTouch Communications Inc. and Alcatel Alsthom.

Globalstar's rival Iridium began service in November and had about 3,000 activated subscribers as of December 31.

Iridium, owned by a consortium of technology and phone companies such as Motorola Inc. and Sprint Corp., uses a network of 66 low-Earth-orbit satellites combined with land-based wireless systems to provide communications services.