SiriusXM back from the brink

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Back in 2009 the already deeply financially stressed US pay-radio broadcaster SiriusXM was contemplating bankruptcy. It had a $1 billion debt obligation and no way to repay the borrowings.

Sirius Satellite Radio and its rival XM Satellite Radio had already merged their loss-making operations (which wrapped in July 2008) in an attempt to save cash, trim expensive competition for rights and reduce operating costs.

John Malone’s Liberty Media stepped in at the 11th hour in February 2009 and engineered a debt-for-equity swap with a $530 million deal that rescued the broadcaster from bankruptcy with just hours to spare.

That’s all history, and during the subsequent eleven years or so SiriusXM’s share price has gone from next-to-worthless to a market capitalisation on September 28th of some $22.5 billion. Indeed, it has been worth more but its share price is somewhat depressed just lately.

However, on its journey SiriusXM has acquired the Pandora radio streaming service for $3.5 billion in 2018, and also during the somewhat complex investment that Malone made into SiriusXM, his Liberty Media (via a subsidiary company, Liberty Radio) has ended up controlling 72 per cent of the company.

There are recent rumours that Malone is planning absorb SiriusXM into Liberty Media.

SiriusXM will announce it latest results on October 22nd.  The broadcaster has already said that it expects to see its subscription grow this year by a net 700,000 and to achieve total revenues of about $7.7 billion and to achieve free cashflow of some $1.6 billion.

SiriusXM and Pandora together reach more than 100 million people each month with their audio products.


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