Satellite Broadcast Winners & Losers: EchoStar

EchoStar (SATS) has acquired a significant amount of Sirius XM Satellite Radio's (SIRI) maturing debt and may be planning an attempt to gain control of the satellite radio operator, according to a media report on Thursday.

Citing "people familiar with the matter," The Wall Street Journal said EchoStar has recently acquired part of a $300 million tranche of Sirius debt that matures on Feb. 17.

Sirius XM was created by the combination of satellite-radio companies Sirius and XM in July, but the company has since suffered from a sharp slowdown in auto sales, which hurt subscriber growth for 2008 and 2009. The company generates many of its new customers through sales of cars that have its radios installed at the factory.

In December, Moody's Investors Service slashed its credit rating for Sirius XM, anticipating that the New York-based company will have to seek a compromise with debt holders next year. Moody's said Sirius has nearly $1 billion of its $3.3 billion debt load coming due in 2009.

Sirius shares have lost nearly all of their value in the past year, closing at 14 cents on Wednesday.

Meanwhile, EchoStar, which sells set-top boxes and also provides satellite services to Dish Network (DISH), reported in November that its losses surged in the third quarter due to writedowns and other losses on troubled investments.

The Englewood, Colo.-based company lost $308 million, or $3.43 per share, in the quarter ended Sept. 30.

EchoStar's stock closed up 43 cents, 2.8%, at $15.83 on Thursday; Sirius XM closed up 2 cents, 15.8%, at almost17 cents; Dish Network closed up 72 cents, 5.61%, at 13.56; and Globalstar (GSAT) closed flat at 23 cents.

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