Sirius XM gets 11th-hour $530m loan

Bankruptcy avoided. Why so Sirius?

Boost IT visibility and business value

Sirius XM Radio has been saved to broadcast another day by US cable tycoon John Malone.

The financially troubled satellite radio provider was tossed a last-minute lifeline Tuesday by Liberty Media, an entertainment conglomerate chaired by Malone that owns a 50 per cent stake in DirecTV.

A $530m rescue financing deal will stave off Sirius' immediate threat of declaring bankruptcy as well as keep its assets out of the clutches of DirecTV's rival, Dish Network.

Liberty Media said it will inject the $530m loan into Sirius' coffers in two phases; an immediate $280m loan to pay off notes due today and a second round of $150m aimed specifically at the company's XM Satellite subsidiary. Liberty will also offer to purchase up to $100m of XM's loans.

The move blocks a bid by Dish Network CEO Charles Ergen who has been attempting to gain control of Sirius XM through purchasing its distressed debt. Ergen has offered to restructure the loans in return for control of the company, but Sirius XM turned him down.

Instead, Sirius has thrown itself to the mercy of Liberty, which gets 12.5 million shares of preferred Sirius stock convertible into a 40 per cent stake in the company. Liberty also gets 40 per cent of the seats on Sirius XM board of directors. The company said Malone and Liberty CEO Greg Maffei are likely to take those seats.

"We are pleased to have come to this agreement with Liberty Media, particularly in light of today's challenging credit markets," said Sirius XM CEO Mel Karmazin in a statement.

The satellite radio company taken on most of its debt when subscriber growth was booming and before the recession made creditors holding on to their cash for dear life.

Under the deal, Sirius XM will need to pay the Liberty loan at an interest rate of 15 per cent due in December 2012. ®


In which we present the Sirius XM loan in the form of a one act screenplay.


I CAN'T pay the rent!
You MUST pay the rent!
But I CAN'T pay the rent!
But you MUST pay the rent!
I'll pay the rent!
My hero!
Drat, drat, and double drat!


Build a business case: developing custom apps

More from The Register

next story
Kate Bush: Don't make me HAVE CONTACT with your iPHONE
Can't face sea of wobbling fondle implements. What happened to lighters, eh?
Video of US journalist 'beheading' pulled from social media
Yanked footage featured British-accented attacker and US journo James Foley
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
Ballmer leaves Microsoft board to spend more time with his b-balls
From Clippy to Clippers: Hi, I see you're running an NBA team now ...
Online tat bazaar eBay coughs to YET ANOTHER outage
Web-based flea market struck dumb by size and scale of fail
Amazon takes swipe at PayPal, Square with card reader for mobes
Etailer plans to undercut rivals with low transaction fee offer
Assange™: Hey world, I'M STILL HERE, ignore that Snowden guy
Press conference: ME ME ME ME ME ME ME (cont'd pg 94)
Call of Duty daddy considers launching own movie studio
Activision Blizzard might like quality control of a CoD film
US regulators OK sale of IBM's x86 server biz to Lenovo
Now all that remains is for gov't offices to ban the boxes
prev story


Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Top 10 endpoint backup mistakes
Avoid the ten endpoint backup mistakes to ensure that your critical corporate data is protected and end user productivity is improved.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Rethinking backup and recovery in the modern data center
Combining intelligence, operational analytics, and automation to enable efficient, data-driven IT organizations using the HP ABR approach.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.