Intelsat SA could receive as much as $4.85 billion for giving up airwaves to be used for fast 5G networks, according to details released Friday of the Federal Communications Commission’s proposal for the transition, Bloomberg News reported. Fellow satellite provider SES SA could receive about $4 billion, according to the plan, which was posted online by the FCC. The proposal, announced by Chairman Ajit Pai on Thursday, envisions as much as $14.9 billion in payments to satellite companies including compensation for their switching costs. The companies have proposed giving up part of the airwaves they use to beam TV and radio programs to stations, and to continue serving customers on airwaves they retain. The swath at issue is known as the C-band, and regulators are eager to free it to carry traffic for 5G networks. Intelsat’s 9.5 percent bonds due in 2023 rallied the most in the high-yield market after the news, gaining 9.5 cents on the dollar to 76.5 cents. Its 8.125 percent notes due in 2023 rose 4.5 cents on the dollar to 53 cents. Intelsat shares erased losses, with the stock trading up 1.5 percent at one point after plunging as much as 16 percent earlier. Intelsat has enough cash on hand to fund the company through 2021. There is “no reason for bankruptcy in the near-term” given the magnitude of the payments in Pai’s plan, JPMorgan Chase & Co. said in a note on Friday.
