Shares of Globalstar, a Louisiana-based satellite company, spiked 35.6 percent on Friday after it said federal regulators approved its spectrum for Wi-Fi use.
The stock gained another 20 percent in after-hours trading.
The company is one of the most shorted on the New York Stock Exchange as hedge funds had made bets that the spectrum was far from valuable.
One of the hedge fund investors, Sahm Adrangi, of Kerrisdale Capital, who shorted shares, said he wasn’t concerned with Friday’s price jump, to $2.45, at the end of regular trading.
“We don’t think Globalstar’s spectrum is commercially viable,” Adrangi told The Post. “We don’t think anything will come of this.”
The head of the $500 million fund said a company like Verizon would have to team with a second company to offer the spectrum or that a tech company would need to buy it.
“Approval doesn’t mean cash flow,” he said.
Globalstar’s billionaire owner, Jay Monroe, who touted the approval by the Federal Communications Commission, has put hundreds of millions of his own money into the business, which plans to roll out a private Wi-Fi channel that will charge consumers for access.
Most Wi-Fi spectrum, which he says is too congested, is free except when accessed through hotels and airports.
In 2013, the company had filed for FCC approval and had long been awaiting an agency decision.
Google told the FCC it should not approve use of the spectrum since Globalstar plans to charge customers.
There is a belief Google is concerned Apple will buy the spectrum and create a private network that does not highlight Google products, a source said.
“This spectrum will increase Wi-Fi capacity worldwide by 30 percent,” Maglan Capital President David Tawil, who is long the stock, told The Post, adding that he believes there is tremendous upside.
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