Shares in London-listed satellite network operator Inmarsat fell as much as 15 per cent today after it ended deal talks with Harbinger Capital Partners for a potential offer, though negotiations could start up again if the hedge fund can get the necessary regulatory approval.

The exact opposite had happened when news of Harbinger's interest in the company had sent its stock soaring 10 per cent in intra-day trading, after having lost 3.3 per cent prior to the announcement. (See: Hedge fund Harbinger makes multi-billion dollar bid for satellite operator Inmarsat)

In n a brief statement, Inmarsat said its talks with Harbinger had focused on regulation and that the hedge fund hadn't made an offer or indicated a potential price. "The Board of Inmarsat has therefore concluded that there is no merit in continuing discussions at this time," the group said.

Shares in Inmarsat fell 5.3 per cent in mid-morning London trading, having lost as much as 14.8 per cent earlier in the session.

Regulatory clearance may take as long as 18 months, Harbinger said today in a separate statement. The New York-based hedge fund is considering whether to pursue approvals, and if it obtains permission, it would resume talks with Inmarsat, Harbinger said.

"In light of this lengthy process, which could take up to 18 months, Harbinger does not consider it appropriate to make a firm offer for Inmarsat at this stage," the it said. "However, Harbinger remains interested in acquiring control of Inmarsat and is therefore actively considering whether to pursue the relevant regulatory and competition approvals.''

The fund said it would make a further announcement as soon as possible.

Inmarsat plc is an international telecommunications company founded in 1979, originally as an intergovernmental organisation. It operates a fleet of eleven geosynchronous telecommunications satellites. The company is publicly traded on the London Stock Exchange as of December 2007.

Inmarsat was originally founded as the International Maritime Satellite Organization (IMSO) as a not-for-profit international organization in 1979, at the behest of the International Maritime Organization ("IMO", a UN body) for the purpose of establishing a satellite communications network for the maritime community.

From the beginning the acronym "Inmarsat" was used. The intent was to create a self-financing body that would improve safety of life at sea. The name was changed to International Mobile Satellite Organization when it began to provide services to aircraft and portable users, but the acronym "Inmarsat" was kept.

When the organization was corporatized, the company was split into two parts: the bulk of the organization was converted into the commercial company Inmarsat plc, and a small group became the regulatory body IMSO. In spite of the commercial structure, Inmarsat has maintained its traditional multicultural atmosphere of some 45 nationalities in the London headquarters. Inmarsat continues to ensure it meets the requirements of a Global Maritime Distress and Safety System (GMDSS) as established by the IMO.

Inmarsat provides telephony and data services to users worldwide, via special terminals. An Inmarsat terminal contacts the satellite and communicates to a ground station through the satellite. It provides reliable communications services to a range of governments, aid agencies, media outlets and businesses needing to communicate in remote regions or where there is no reliable terrestrial network.

Harbinger is run by Philip Falcone, a former trader at Barclays Capital, and operates funds under management of $26.5 billion (£13.4 billion) as of the end of June. It was forced to admit that it was lining up a potential offer after it emerged that Harbinger had hired Merrill Lynch, the American investment bank, to review the possibility of a bid. Merrill has a longstanding relationship with Harbinger in the US, but this is the first time that the bank has advised it on a European deal.

Sources close to the fund said that Harbinger wanted ''to take control of the company, just like a traditional strategic buyer''.