Indian service providers of WorldSpace, the popular satellite radio service provider that has now filed for bankruptcy under Chapter 11 in the US, are now exploring legal options to get their money back.

The US company, locally endorsed by famous music director A R Rahman, last week filed for bankruptcy. It has assets of $ 307 million and liabilities in excess of $ 2 billion, according to the bankruptcy document filed in United States Bankruptcy Court, District of Delaware.

As per the bankruptcy document, WorldSpace owes money to several Indian companies such as Phonographic Performance (provider of music and licences to play songs), Antrix (a government of India undertaking), BPL Technovision (supplier of satellite receivers), Epigon Media Technologies and Lepton Software Export & Research.

The company owes these Indian vendors money in the form of unsecured debts or trade debts, says the document filed by WorldSpace. The company, which launched commercially in India in 2005, may have subscribers in excess of 1,70,000 customers.

M Sebastian, managing director, WorldSpace India, said, “We have filed under Chapter 11 for protection. This is just normal financial restructuring procedure. We want to systematically restructure our debt. It is not going to affect our business in any way. We will continue to provide radio services to our existing customers and keep selling our sets to new customers.”

The company was launched with the intention of providing digital satellite radio primarily in the emerging markets of Asia and Africa. The radio services are provided on a subscription basis and the radio services are uninterrupted because it has no spots. The only source of income is subscriptions.

“We are waiting for some kind of communication from the committee. We are also talking to other Indian companies who are affected by WorldSpace to see if we can take a combined action. We plan to file a case against the company. We have just approached a law firm in Bangalore, Mumbai and Washington, DC to see how we can recover our money.” said an official with BPL Technovision.

An Antrix official said the company has just got to know about WorldSpace’s bankruptcy filing. “Our management is yet to take a call on the debt they owe Antrix,” the official said.

While it is not clear if the bankruptcy filing would impact the subscribers of WorldSpace radio, a customer care executive said the operations in India remain unaffected.

R J Venkatramanan, chief business and product development officer, Epigon Media Technologies, said, “It’s very sad to know that they have filed for bankruptcy. We have been with them since the beginning. We developed technology to make it mobile. We showed the first demo of their mobility to their investors because of which they were able pump funds into the company.”

WorldSpace radio service at present is not mobile, but the technology developed by Epigon enables it to go mobile.