Sirius XM Averts Bankruptcy
A $530 million investment by cable services provider Liberty Media Corp. has saved Sirius XM from possible bankruptcy and that means the satellite weather service provided through most of the popular avionics suites should be in no danger of lapsing. Sirius XM announced last week that it had $175 million in debt coming due and no money to pay it. It warned that if it didn't get a lifeline of some kind, it would have to seek bankruptcy protection, although analysts didn't believe that service would be disrupted even if that had happened. The lifeline came at a price, of course, and Liberty Media now has a major stake in Sirius XM.
Liberty's investment equates to about 10 percent of the asset value of the company but it's getting 12.5 million preferred shares that can be converted into 40 percent of Sirius's common shares. Liberty also gets two seats on the board of directors.