LightSquared has moved another step closer to exiting Chapter 11 after the U.S. Federal Communications Commission (FCC) granted approval to transfer its spectrum to a new company that will be chaired by former Verizon CEO Ivan Seidenberg.

"The transfer of licenses from old LightSquared to the new entity allows for the company to exit bankruptcy proceedings and offer services to the American people," said FCC commissioner Michael O’Reilly, in a document published on Friday.

‘New LightSquared’ will be controlled by equity firms Fortress Investment and Centerbridge Partners, as well as JPMorgan.

According to the FCC, Fortress will own 26.2%, Centerbridge 8.1%, and JPMorgan 21.25%. The remaining 44.45% will be held by LightSquared’s original backer, Philip Falcone’s Harbinger Capital; however, according to a Wall Street Journal report, it won’t have any role in New LightSquared’s day-to-day operations.

"We will emerge from restructuring with new owners representing some of the world’s top investors, and they have committed significant new capital to give the company the runway it needs to grow and operate the business," said a statement on Friday from LightSquared CEO Doug Smith, who will continue to lead the newly-organised company.

LightSquared named former Verizon CEO Ivan Seidenberg as chairman of the new company.

"FCC approval will enable LightSquared to successfully exit bankruptcy protection, but, more importantly, it kick starts a major step toward private investment in our national wireless infrastructure," Seidenberg said, in a statement.

In February 2012, the FCC withdrew its support for LightSquared’s proposal to build a combined satellite and terrestrial LTE network and operate it on a wholesale basis following complaints from GPS providers Deere, Garmin and Trimble that the network would interfere with their signals.

Without a network, LightSquared had no business, and it filed for Chapter 11 in May that year. In 2013, the company sued the GPS firms for not disclosing the interference issues earlier.

In February this year, a judge dismissed most of LightSquared’s claims against the GPS firms, and by the summer the two sides had begun working towards a settlement.

"We intend to do everything possible to achieve a reasonable business solution as well as an engineering consensus between wireless broadband and the GPS industry," said Seidenberg on Friday.

One of the big winners in the case will be Dish Network CEO Charlie Ergen, who became LightSquared’s largest creditor by buying up debt after it filed for bankruptcy. The executive bought up $1 billion of LightSquared’s loan debt and under the restructuring plan will receive repayment in full, plus interest.

Share