Liberty Request to Control SiriusXM Denied
Today the U.S. Federal Communications Commission dismissed Liberty Media’s request for the licenses that would have given John Malone control over SiriusXM. It turns out “40 is not the new 50.”
Mark one down for Mel Karmazin and the SiriusXM shareholders on this one. Although, at is hard to call billionaire SiriusXM savior John Malone a loser.
The FCC, rejected the March 20th application citing “Liberty Media was unable to obtain the passwords, signatures, and other necessary information from Sirius to properly file an electronic transfer of control application.”
In other words, the FCC is saying SiriusXM didn’t give you the licenses and… no, you can’t just have them.
Keep in mind that this does not mean that Mr. Malone still cannot gain control of SiriusXM, it just means that it’s not going to be that easy (or cheap). Liberty Media will now need to grow their 40% stake to at least 50% and then force shareholders to vote on the matter.
This means an increased cost to purchase shares and a sizable bill from the taxman if the transaction is in fact an acquisition.
What will happen to SiriusXM and it’s share price is anyone’s guess so, go ahead and guess in the comments below!
Malone is just to good to count out. My guess is he does nothing. Sirius continues to pile up cash. They agree to using excess cash to both pay down debt and buy back shares. This buys several years for both. Mel won’t buy back to the point where Malone get to 50% but it will reduce the amount Malone would need for control. If shares rise to$3.00-3.50 everyone wins. Thinking 2015 or 16….
My guess is one billion dollars/share come Monday morning, give or take.
Malones application is returned as “incomplete” Sounds like he refiles with the complete application?
With the password Mel has tucked under his pillow ? Mel will give up the password for $ 3/share maybe…
mel is not stupid @least 6bucks a share
The spectrum is likely worth triple of what they are showing on their financials, so $5 would be a fair value or even better 6 like you say.
Contrary to so self-proclaimed legal exprt, SiriusXM executives
did not give up the store to LMCA. Can we have your opinion on
what to expect the next step from Malone/
What r the real value of the nol’s as far as the stock price goes?????
Why would shareholder approval be needed if Liberty buys over 50%. They will have simple voting control.