Sirius XM / Liberty Reach Deal

[jwgreen68]

So what you are saying is that our stock goes away? We get .20 per share? Then there is no reason for anyone to be buying any right now is there?

Your stocks haven't gone away. You own them, even if they are worthless. They avoided bankruptcy, probably for at least another year. Your stock is worth .20/share now. It's not going anywhere but up now. There's positive cash flow again. If you purchased the stock yesterday at .10/share, like I did, then today you doubled your money. Just wish I had bought more than a thousand shares.

And remember, during the Great Depression, those stocks made great toliet paper. You can never have enough of that!

 

[MacDawg]

Now they need to open up both sides of the channels. Get rid of the same split thats been there since each had their own companies. Please!!

 

[paja]

That would make me laugh. Charlie gets the profits from Malone once the check clears, puts the money in the bank. Then Charlie uses said money to buy out Sirius XM outright come the end of the year, thanks to Malone.

Or maybe pays the money he made to TIVO

 

[paja]

Good ones, the only comment I have is regarding #6, I took the advantage of the great GM incentives for loyal customers and traded in my old truck for a new one a few days ago, this Sirius rescue will allow me to enjoy the three months free Sirius radio without interruption

A few days ago I thought my newly acquired truck would have a useless piece of electronic junk with a piece of ugly antenna on the roof top. Now such reality is pushed back

I did the same thing, took advantage of those great GM incentives(and after the stimulus bill passed, writing off the sales tax) to get a new 2009 Chevy with an outstanding built in XM radio and free three months.

 

[TulsaCoker]

Winners today.....

1. Charlie. OK, he didn't get control... he just made 5-10x his investment back since the debt gets paid in full for the 10 cents on the dollar (or whatever he paid for it) he paid out. He could have lost it all in bankruptcy, but Mel would have had a shareholder revolt if he did that.

Not correct. For the little i understand some or a lot of the debt charlie bought is not due until december and even some at was paid off may not be paid in the full amount. it's like when a company buys bad debt for penneys on the dollar typically it's not paid back at full price by the borrower.

 

[BobMurdoch]

I had heard all of the debt he bought was from the February bonds that were coming due... He didn't NEED to buy any of the mid year or December bonds since he could push them into giving control to him on the February ones alone....

 

[navychop]

Yep, that's my understanding. And lacking bankruptcy protection, the debtor will pay in full unless the creditor is agreeable to take less.

 

[jrbdmb]

No, not always. It would be similar to someone refinancing their house to get a better rate. It makes the loan longer, but the payments are usually lower and more manageable. A lot of times, individuals/businesses can go into bankruptcy even, and come out stronger and more financially secure than before they went in. A prime example would be Donald Trump. Several years ago he filed for bankruptcy and didn't lose a dime of his own personal wealth. It's all about making those debts more manageable. It's in a creditors best interest to work with the debtor to find a resolution, that works for both parties, rather than the debtor enter into bankruptcy. I'd rather wait for my money a little longer than accept pennies on the dollar from bankruptcy court.

But in this case Sirius/XM went from 2 1/2% notes due now to 15% notes that mature in 2012. Unless there is some enormous untapped revenue that Sirius/XM plans to tap in the near future (or huge contracts that will be renegotiated), Karmazin has merely put off the day of judgement a few years to save his job (and his buddy Howard's contract).

 

[shibby191]

So Liberty Media was the white knight today, but that just means Liberty will have a place at the table and not Echostar. So why did they choose to go this route? Sirius has had a long term relationship with Echostar. What has changed? Did they really hate Charlie that much that they would chose "anyone" over him?

Pretty much. Mel doesn't want to work for Charlie. Of course, who would?

 

[TulsaCoker]

Here's the quote from an article about the debt Ecostar purchased. "The paper reported that Echostar has purchased about $400 million of the company's debt -- including $175 million set to expire on Feb. 17 -- from various hedge funds."

 

[kingjeste]

This is an complete waste of money. spending 280million on xm radio.. should of let goto the pots..

 

[Ramy]

This is an complete waste of money. spending 280million on xm radio.. should of let goto the pots..

Don't poop on people's parades. It's a choice, if you don't like it then move on.

 

[Rangers484]

What was Charlie Ergen's offer to Sirius XM? - Orbitcast

Has anyone commented on this? It seems Karmazin may have put his personal interest above the health of his company by accepting Liberty's offer rather than Charlie's.

Charlies was better but it would have resulted in him taking control of the company.

Based on the article, Charlie is not out of the fight yet.