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Loral
Expectations Lowered by Globalstar Woes
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Banc of America
Securities' Armand Musey lowered his 2001 year-end price on Loral
stock to US$9. Musey took the action due to concerns that Loral may
be adversely affected by a potential bankruptcy of Globalstar.
However, Musey does not expect any potential bankruptcy of
Globalstar to pose a direct threat to Loral.  Musey
stated, “Loral has the option to just walk away from Globalstar,
without being held liable for any of its debt, other than the
term-loan for which it already assumed responsibility.” Loral owns
about 39 percent of the Globalstar venture.
Musey
maintained a “buy” rating on the Loral stock, however, with the
company trading around US$4 - 5 a share, “We believe this is well
below the company's pure asset value.”
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