Karmazin Juices Sirius Shares

Updated from Nov. 18

Sirius (SIRI Quote) surged Friday after the satellite radio upstart scored its second high-profile coup in six weeks, hiring former Viacom (VIA Quote) chief Mel Karmazin as CEO.

The news comes just six weeks after the company lured New York shock jock Howard Stern away from Viacom's Infinity radio business in a $500 million deal. Sirius also signed a exclusive deal with the National Football League late last year to broadcast pro football games.

The shares were recently up 78 cents, or 16.5%, to $5.50 in Instinet premarket trading.

Karmazin left Viacom this summer after his latest dustup with the media giant's chief and controlling shareholder, Sumner Redstone. Karmazin will replace Joe Clayton, who will remain as chairman, according to the Sirius press release Thursday.

"This is a perfect opportunity for me because I want to lead a growth company that can reshape the landscape of the radio business," Karmazin said.

Sirius, a New York-based satellite radio broadcaster, has been trying to join the big leagues of media despite its fledgling 700,000-subscriber base.

"I am very confident that Mel will accelerate the very positive momentum that we have established at Sirius in the past two years," Clayton said in a press release.

Last month, Sirius posted a disappointing loss of $169 million, or 14 cents a share. The ever-deepening pool of red ink, the company's low subscriber count and the costs of luring Stern renewed worries about Sirius' financial state.

Even so, the stock has more than doubled in the last three months as growth-starved investors board the pay-radio bandwagon pulled by Sirius and rival XM Satellite (XMSR Quote). Sirius has said it expects to have 1 million subscribers by year end.