Globalstar stock continued to tumble Monday as a short-seller continued to take shots at the Covington-based satellite phone company.
Shares of Globalstar were down 9 cents, or 5 percent, to close at $1.71 Monday. The stock price has plunged from its $3.66 a share close on Sept. 30. That was the day before Sahm Adrangi, founder of Kerrisdale Capital Management, started criticizing Globalstar stock as being “worth nothing.” Kerrisdale is shorting Globalstar’s stock and could profit from a drop in share prices, Globalstar has said.
On Friday, Kerrisdale sent a letter to the Federal Communications Commission related to Globalstar’s plans to set up a terrestrial low-power Wi-Fi network by tapping into the spectrum set aside in areas where satellite phones aren’t needed. The FCC is reviewing Globalstar’s request to establish the TLPS, which the company said will boost Wi-Fi capacity in the U.S. by one-third immediately.
The 12-page letter signed by Adrangi said the TLPS concept is “technically and commercially defective and will do nothing to expand wireless broadband capacity.” The letter also said the test results Globalstar and its technical partner, Jarvinian Wireless Innovation Fund, have presented to the FCC are “inadequate and misleading.”
Globalstar said the Kerrisdale letter demonstrates “a lack of understanding of our company and our industry.” The company also noted that while Kerrisdale was claiming last week that Wi-Fi congestion was a myth, it has now changed its position.
“We have made tremendous progress at the FCC regarding TLPS and look forward to the commission adopting its proposed rules promptly,” Globalstar said. “We do not believe there is anything in Kerrisdale’s filing that will affect this timing.”