Liberty Media, the owner of DirecTV, has swooped in at the last minute to save Sirius from certain bankruptcy. Liberty will invest a $530 million in the form of loans to the satellite radio company, $175 million of which will go to paying debt that comes due for Sirius today.
Sirius’s CEO said in a statement:
“We are pleased to have come to this agreement with Liberty Media, particularly in light of today’s challenging credit markets. Liberty’s investment is an important validation of what SIRIUS XM has already achieved and a vote of confidence in what we will achieve. This agreement enables Sirius XM to continue to develop the opportunities first outlined in the merger of Sirius and XM. By strengthening our capital structure and enhancing our financial flexibility, this investment allows us to continue providing the great content and innovative programming our subscribers know and love.”
The Washington Post says that Sirius has never turned a profit, despite 20 million subscribers and a payroll that includes expensive radio personalities such as Howard Stern, who is paid $100 million a year.
SIRIUS XM Radio and Liberty Media Reach Agreement for Investment (Press Release) [Sirius XM]