Sirius XM Pondering Bankruptcy Plans
Thu, 12 Feb 2009 09:57:20
According to a New York Times report, Sirius XM radio is preparing to file for bankruptcy. The company brought XM and Sirius together under one satellite radio banner in July 2008, and is currently dealing with $3.25 billion in debt thanks to the tight credit market, expensive hosts, and practical matters like the prohibitive cost of sending satellites into space. While subscribers shouldn't worry about their service being interrupted just yet, Sirius XM may have to terminate the contracts of top-notch talent like Howard Stern and Martha Stewart.
One exit option may be having Echostar, a satellite TV company, buy out Sirius XM's mounting debt. They already snatched $400 million of it in December of last year. (Echostar chief executive Charles W. Ergen is reportedly in talks with Sirius chief executive Mel Karmazin as we speak.)
As of Tuesday, Sirius XM stocks were worth just 11 cents per share.
—The ARTISTdirect Staff