LightSquared bankruptcy seen imminent: sources By Svea Herbst-Bayliss and Sinead Carew Mon May 14, 2012 12:30pm EDT (Reuters) - LightSquared Inc MOSAV.UL, the startup telecommunications company bankrolled by hedge fund manager Philip Falcone, is expected to file for bankruptcy protection in the next hours, sources familiar with the matter said. While the parties still have a few hours left to negotiate, the sources suggested that a last minute deal is highly unlikely and that the filing is imminent. A representative for Falcone was not available for comment. "The bondholders are asking for conditions they know Harbinger and Phil cannot agree to," a source close to the situation said on Sunday. Falcone, once one of the hedge fund industry's biggest stars, had already been given a reprieve twice before when debt holders extended the original April 30 deadline two times. LightSquared has been fighting for its life since February when the U.S. Federal Communications Commission said it would revoke permission provisionally granted to LightSquared to build a high-speed wireless network. Tests found that LightSquared's systems could interfere with the Global Positioning System, critical to the military, commercial aviation, and many other industries including agriculture. Falcone, who once managed around $26 billion for wealthy investors, has faced off against other prominent hedge fund managers who had bought the company's debt. Law firm Milbank, Tweed, Hadley, & McCloy is the debtor counsel and Lazard is the restructuring adviser. Reporting By Svea Herbst-Bayliss, Matthew Goldstein, and Sinead Carew; Editing by Tim Dobbyn