UPI Announces Tentative Agreement With Bonneville
WASHINGTON (AP) _ United Press International said Monday it has reached tentative agreement to sell 1,000 satellite dishes to Bonneville Telecommunications Co. for $1.8 million.
The deal is contingent on the financially troubled wire service succesfully completing proceedings under Chapter 11 of the federal bankruptcy laws ″in a manner satisfactory″ to Bonneville, according to a UPI statement read by spokesman David Wickenden.
UPI executives are trying to find a purchaser for the company.
The wire service transmits its news report via transponders on two space satellites, Westar III and Westar IV, owned by the Western Union Co., the announcement said. More than half of UPI’s clients receive the report via earth dishes manufactured by Equatorial Communications, it said.
Bonneville, based in Salt Lake City, would buy 1,000 of UPI’s 2,800 satellite earth stations, paying $900,000 to Equatorial to remove a security interest and clear title to the equipment and $900,000 into a UPI-Bonneville trust fund that would cover the costs of switching to the new network, according to the statement.
It quoted UPI Vice President Robert Brown as saying the arrangement would save UPI $3 million to $3.5 million a year in domestic operating costs.
As owner of the Equatorial dishes, Bonneville would ″have the ability to sign up other clients who want to get information to the same people,″ the UPI statement quoted Bonneville President Kenneth Bentley as saying.
Bentley said Bonneville would provide UPI with centralized satellite transmission and a new form of delivery via FM subcarrier radio waves.