Highland Capital demands look at Loral Space's books in connection with MHR private placement

By Lisa Kerner

Charlotte, N.C., March 15 - Loral Space & Communications Inc. investor Highland Capital Management LLP and its affiliates, beneficial owners of 921,879 shares, or about 5%, of the company's common stock, are demanding an inspection of Loral's books and records for breeches of fiduciary duty related to purchase agreements with MHR Fund Management LLC.

The investor may use information obtained through the inspection in possible litigation or other corrective measures, according to a letter to Loral included in a schedule 13D filing with the Securities and Exchange Commission.

In a previous letter to Loral's board of directors, Highland Capital said the $300 million private placement of convertible preferred stock smacked of "insider trading because of MHR's position with respect to Loral."

MHR is one of Loral's majority shareholders.

Loral is a satellite communications company based in New York.

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