DBSD eyes sale of $31.2 million of loan-backed auction-rate securities

By Caroline Salls

Pittsburgh, June 3 - DBSD North America, Inc. requested court approval to sell $31.2 million in student loan-backed auction-rate securities for cash, according to a Tuesday filing with the U.S. Bankruptcy Court for the Southern District of New York.

The company bought the securities during the first quarter of 2008 using the proceeds from the sale and maturity of its investments, as well as cash and cash equivalents.

The securities consist of variable-rate bonds with maturities ranging from 24 to 39 years.

Some of the securities purchased by DBSD in 2008 are covered under an agreement under which the company can require UBS to repurchase them at par value from June 30, 2010 to July 2, 2012.

The company is looking to sell the securities not covered under the UBS agreement.

The sale proceeds will be used to maintain the company's going-concern value while it finalizes a plan of reorganization.

A hearing is scheduled for June 15.

DBSD is a subsidiary of ICO Global Communications (Holdings) Ltd., a Reston, Va., mobile satellite services company. The subsidiary filed for bankruptcy on May 15. Its Chapter 11 case number is 09-13061.

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