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Could Liberty Media come to XM’s rescue

By | Published on Friday 13 February 2009

US satellite radio firm Sirius XM which, as previously reported, is preparing for Chapter 11 bankruptcy protection, has reportedly been approached by QVC owners Liberty Media’s DirecTV satellite TV company about a deal to rescue the faltering broadcaster, which is facing heavy debt repayments.

Sirius chief Mel Karmazin is reportedly in favour of some kind of Liberty deal, mainly because it would scupper attempts by another satellite company, EchoStar, to claim ownership of the company.

EchoStar has been buying up Sirius’ debts since its takeover approach was knocked back last year, presumably in a bid to force the radio firm into some kind of takeover deal when it defaults on its loan repayments.

Some reckon Karmazin is applying for Chapter 11 protection to stop EchoStar pursuing its hostile takeover, mainly by providing him with the time to negotiate a deal with Liberty.

Meanwhile Howard Stern, Sirius’ biggest and most expensive star, has dismissed the radio firm’s financial problems as “growing pains” telling reporters he still believes the satellite radio enterprise can be a success.

Speaking on his show on the network, he said: “Everybody’s wondering about this whole bankruptcy thing with Sirius. I’m not concerned. I think satellite radio is great and will be a successful business and it will survive”.