New satellite system operator ICO Global Communications is hoping to raise up to $1 billion from its current rights issue as it attempts to reach the $4.5 billion target required to allow the launch of commercial operations next year.

The rights issue is due to be completed at the end of this month. ICO says it previously raised $3 billion and remains "cautiously optimistic" that it will reach $4.5 billion, although industry sources suggest the company has recently been in discussions with its major investors on contingency plans following its failure to meet recent targets. ICO aims to launch commercial mobile satellite services in the third quarter of next year.

ICO and other new satellite system operators have been affected in their efforts to raise finance by the downturn in fortunes of competitor Iridium. Major shareholder Motorola has warned that Iridium, struggling to meet its subscriber and investor targets, could face bankruptcy unless other backers help in its rescue.

Iridium has delayed interest payments while creditors and investors continue discussions on restructuring its debt.

ICO remains confident that there is a market of 30-40 million potential users worldwide. The company had been hoping to launch the first of its 10 medium earth-orbit satellites this month on a Russian Proton booster, but the failure of the Proton earlier this month has delayed the launch.

Source: Flight International