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Satellite : Sirius XM Stars on the Block?
Satellite radio provider Sirius XM has been making waves lately -- receiving debt "help" from EchoStar, rebuffing takeover advances from Charlie Ergen -- but its latest brush with the business pages may be its biggest yet.
According to reports on Wednesday, the company has hired advisers including bankruptcy lawyers Joseph Bondi and Mark Thompson to help it prepare for a possible bankruptcy filing. If it happens, the $5 billion company would rank as the second-largest bankruptcy filing of 2009.
On the one hand, Chapter 11 would be a disappointment after the much-ballyhooed merger of XM and Sirius last spring. But, on the other, the company's recent string of sub-10 cent stock prices (plus its staggering $3.25 billion in debt) would seem to indicate that bankruptcy protection might not be such a bad idea after all.
Whatever happens, there will likely be little change in the short term for subscribers. But, big-ticket talent like Howard Stern and Martha Stewart had better watch out. The cost cutting axe could very easily fall on their multi-million dollar contracts in short order.
Satellite radio provider Sirius XM has been making waves lately -- receiving debt "help" from EchoStar, rebuffing takeover advances from Charlie Ergen -- but its latest brush with the business pages may be its biggest yet.
According to reports on Wednesday, the company has hired advisers including bankruptcy lawyers Joseph Bondi and Mark Thompson to help it prepare for a possible bankruptcy filing. If it happens, the $5 billion company would rank as the second-largest bankruptcy filing of 2009.
On the one hand, Chapter 11 would be a disappointment after the much-ballyhooed merger of XM and Sirius last spring. But, on the other, the company's recent string of sub-10 cent stock prices (plus its staggering $3.25 billion in debt) would seem to indicate that bankruptcy protection might not be such a bad idea after all.
Whatever happens, there will likely be little change in the short term for subscribers. But, big-ticket talent like Howard Stern and Martha Stewart had better watch out. The cost cutting axe could very easily fall on their multi-million dollar contracts in short order.
