Shares of Intelsat (I) - Get Report blasted off Tuesday after billionaire investor David Tepper scooped up nearly 3 million shares in the satellite communications company, which has been buffeted by the dramatic shift toward 5G.

Intelsat's stock price rocketed 26.45% to $3.92 a share after news broke of Tepper's big investment, which will give him control over more than 2% of the satellite company's shares.

In a letter to Intelsat's board, Tepper, head of hedge fund Appaloosa LP, contended the company should take a tougher line with the Federal Communications Commission's plan to auction off some of the C-band airwaves controlled by companies like Intelsat for use by mobile providers amid the shift to 5G.

The FCC's current proposal requires satellite operators to spend billions of dollars over the next nine months to clear spectrum for the federal agency's planned C-band airways auction, slated for Dec. 8, Tepper wrote.

But at the same time, the proposal pushes off to the "back end" billions in compensation that would be paid to Intelsat and other satellite companies to later in the process, the hedge fund chief argued, calling the FCC's offer an "affront" and "manifestly unfair."

Intelsat also faces a particularly challenging situation, with more than $14 billion in debt, Bloomberg has reported, citing New Street Research.

Tepper is urging Intelsat's board to consider bankruptcy or litigation unless it can win a better deal from the FCC.

"For a highly leveraged operator, such as Intelsat … the cash required to conduct that process imposes a hardship that could easily trigger an insolvency," Tepper wrote.

The C-Band Alliance, which includes satellite operators like Intelsat, is likely to walk away from talks with the FCC unless it receives an offer of at least $16 billion, according to New Street.

The FCC recently offered $14.7 billion, including $9.7 billion in incentive payments to companies that speed up the transfer of airwaves to 5G mobile operators. However, some members of the U.S. Senate are pushing for a cap on payments in the $6 billion range.