Intelsat seeks mediation of plan and confirmation-related disputes

By Sarah Lizee

Olympia, Wash., April 7 – Intelsat SA is seeking mediation of its Chapter 11 plan and confirmation-related disputes, according to a motion filed Tuesday with the U.S. Bankruptcy Court for the Eastern District of Virginia.

The company said it filed its plan with support of significant creditors at every level of the capital structure.

Since then, the debtors have made substantial progress in narrowing the gap between the large creditor constituents that support the plan and the large constituent that does not.

These discussions, however, have yet to yield a comprehensive resolution, Intelsat said.

The company said the economic gap that remains between the parties’ latest proposals is narrow at around $70 million.

“Given the importance of progressing the cases efficiently and the narrow economic gap that remains, further targeted negotiations on economic and other terms facilitated by a sitting bankruptcy judge would be preferable for the estates over the alternative – significant, value-destructive litigation that will ultimately cost the estates more than the amount in dispute,” the company said.

“And for this same simple fact – that the disputes represent tiny fractions of recoveries to stakeholders – the debtors believe that a focused mediation will be efficient, successful and value-maximizing.

“Indeed, at this point in this extremely complex case, all stakeholders would benefit from the views of an independent third party to provide candid feedback on their position and further objective suggestions to aid the debtors in resolving these disputes.”

The debtors’ proposed order would require key stakeholders in the Chapter 11 cases to mediate in good faith until a global settlement is reached or the mediator declares the parties to be at impasse, whichever occurs first.

Intelsat is a Luxembourg-based satellite telecommunications company. The company filed bankruptcy on May 14, 2020 under Chapter 11 case number 20-32299.

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