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Sirius Shares Hit on Shelf Filing

TSC Staff

A $500 million mixed shelf registration filed by Sirius Satellite(SIRI Quote) had investors jittery in Tuesday's early going.

The satellite radio company swore it has no plans to do anything under the shelf, which covers debt securities, common and preferred stock and warrants. But given the company's recent love affair with the capital markets, investors concerned about further dilution were nervous.

Sirius' never-a-dull-moment shares were recently off 9 cents, or 5%, to $1.59.

The company says it has about $560 million in cash and equivalents, enough to fund itself through cash-flow break-even, it thinks. Sirius sold a slug of convertible notes in May and common stock in June, leaving it "in an excellent position," with the strongest balance sheet in what it referred to as "the industry." (Sirius has one competitor, XM Satellite Radio(XMSR Quote).)

"Shelf registrations are a great tool for allowing Sirius to opportunistically enter the debt and equity markets in the future for transactions that enhance stockholder value, such as acquisitions, debt issuances to fund stock buyback programs and other expansions of our business plan," Sirius said.