This is fun. lets continue.Originally Posted by JohnnyIrishXM
Are you in the liberty will sell their stake to another buyer, or do you feel they will buy 50 percent themselves, or 100 percent themselves? I guess its obvious now they intend to buy more shares with how the poison pill was worded.
I,m assuming Malone will follow the Direct TV model and take ownership of +50% straighten it up and prepare to sell it to highest bidder,or turn it over to Maffei and let him do what he wants with it,Malone is getting older,65yo i think..
BTW,Malone has a histroy with Tax deals,he turned Time warner into Atlanta braves as a tax free transaction and doing same with
DirectTV..
my personal opinion is he already bought his 9.9% stake with 523mil loan,which i think is what extra billion shares are for,he will take shares for some of that debt at this rediculous SP,why would he wait til it gets higher?
Are you saying he has arranged and discussed the purchase of more shares, or bought them on the open market? If he bought them on the open market wouldnt he have had to file? or are you saying he bought them through a third party. or many parties who have agreed to sell them to malone at a certain price, at the time of his choosing.
Look at it logically,Siri is paying off 150mil of credit facitility loans Liberty took over in deal with cash on hand this year and next.
They pay off rest of Liberty debt with shares or close to it,which frees them of hefty interest payments from bottom line,greatly improves FCF and EBITDA for next 2 years.
Now auto industry is back with a vengence and every 100k in gained subs over today adds roughly 144 mil a year in FCF.
By end of year 3 coincidentally(NOL Kicks in) they will probably be debt free..
Malone pockets tax savings of 2billion in pocket on immense profits..
Then they are knocking down the door...
No.9.9% of 7.2 billion shares is roughly 712 million shares,so the company does a debt to share swap for 712mil with liberty at that days SP,but remember Liberty gets 40% of common when convert of preffered happens so they have to hold back 280 mil shares to cover it,see 712 + 280= 1Billion..
The math is a little off,but with 9 bil shares Liberty is owed 3.6 bill at conversion..for 40% stake.
At 49.9% it is roughly 4.4 bil or so leaving Siri with 700 mil shares for debt swap with others or emergencies..
Last edited by JohnnyIrishXM; 05-09-2009 at 08:25 PM.
Interesting. That does make a lot of sense. heres another question for you. Wouldnt it be in Liberty's best interest to buy the shares now, while its cheap. Or do you think sirius only agreed to the deal in the first place because malone agreed to take lets say $1 a share for the balance of the 10 percent stake. Gives more of a real value to what Liberty would end up actually paying for the 40 percent stake, when you factor in the substantial increase they need for the final 10 percent to get to 50 percent. 40 percent was a loan. then they use 10 percent to pay the loan back.
Relmor,i wouildn't think so.and it is only 400 mil now,as 130 will have been paid off,25mil to credit facility this Q and 30 mil fee already paid.plus 50 mil next q and 25 mil in dec..
So it is a race for Malone of Sp rising and May passing of Extra shares.Interesting isn't it!!!
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