A group of Sirius XM's creditors are planning to try and oust the US satellite radio firm's top man, Mel Karmazin, in a bid to protect their interests.
As previously reported, Sirius may apply for Chapter 11 bankruptcy protection, reportedly in a bid to stop a hostile takeover by another US satellite company called Echostar, which Karmazin is keen to avoid.
However, the aforementioned creditors, who would obviously prefer the company to opt for takeover rather than consider bankruptcy, are, according to the Wall Street Journal, preparing to block any attempt to do so, mainly by insisting the company fire former MTV boss Karmazin.
The Journal quotes the lawyer representing the creditors, who said: "Creditors will act quickly and definitively if they perceive that management is acting … in the best interest of the estate".
EchoStar have been buying some of Sirius' not insubstantial debts after Karmazin knocked back a takeover offer last year. The Sirius boss seemingly hopes he can rescue the US's only satellite radio firm - created by the merger last year of Sirius and XM - through an investment deal with another media company, Liberty Media Group.
Sirius said yesterday it had managed to refinance some of its debts, which may in itself buy them enough time to complete the Liberty negotiations.
However, they may as yet have to apply for Chapter 11 protection to stop Echostar forcing a takeover while the Liberty talks continue. If they do, it will be interesting to see how the aforementioned creditors respond, and what affect that has.