This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
See Cramer's multi-million dollar portfolio for FREE and get his new book Get Rich Carefully! Learn More

Sirius XM Soars on Liberty Media Rescue

Updated from 3:15 p.m. EST

In a last-minute deal, Liberty Media (LINTA) saved Sirius XM (SIRI) from bankruptcy with a $530 million loan infusion giving John Malone's company a 40% stake in the satellite radio shop.

As reported, Sirius CEO Mel Karmazin was scrambling Monday to close the deal with Liberty Media and not only save Sirius XM from bankruptcy, but also fend off a takeover bid by Dish Network (DISH) operator Charles Ergen, who has sought to oust Karmazin.

The deal -- news of which sent shares soaring more than 50% -- has two phases. The first installment is an immediate $280 million secured loan to pay off a $171.6 million obligation that was due Tuesday. The remaining money will be used to keep Sirius operating and to cover transaction costs. The second stage of the Liberty investment calls for another $150 million loan to XM Satellite Radio, with an agreement to buy $100 million in XM loans outstanding.

Given the tight credit market and the unwanted takeover option from Dish, Sirius agreed to pay a 15% interest rate on the Liberty Media loans. In exchange for the loan, Sirius will issue 12.5 million shares of preferred stock that will convert to a 40% stake in the company's common stock.

Malone and Liberty Media CEO Greg Maffei will take two seats on the Sirius board of directors.

"This agreement enables Sirius XM to continue to develop the opportunities first outlined in the merger of Sirius and XM," Karmazin said in a press release. "By strengthening our capital structure and enhancing our financial flexibility, this investment allows us to continue providing the great content and innovative programming."

Stock quotes in this article: SIRI, DTV, DISH 

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
DOW 16,507.72 -6.65 -0.04%
S&P 500 1,875.99 -3.56 -0.19%
NASDAQ 4,129.12 -32.3380 -0.78%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs