Sirius XM Makes Tender Offer to Purchase Convertible Notes Due 2011
Likely this initiative was taken, and made sweet enough, to take out the remaining bonds by offering holders cash now rather than having them wait until October for the remaining interest payment. If successful, the company could have interest savings somewhere in the neighborhood of $1 million this year. The numbers certainly are not staggering, but the move is prudent and points to managements commitment to running a tight ship.
[via SiriusXM Release]
Position – Long Sirius XM Radio
“The numbers certainly are not staggering, but the move is prudent and points to managements commitment to running a tight ship.”
Spencer! Is that you? Come right over here and let me give you a big wet kiss!
David Frear takes no prisoners!
What does this mean for current shareholders? With money hog Howard Stern suing SiriusXM, I’m getting a bit concerned with my stake in the company.
Spencer,
I see you say they are saving 1M interest payment, but is there a cost to calling the bonds early and if so, what is the cost ?
I am thinking it is not so much the savings, but more just them wanting to put it behind them, maybe pushing up the time frame for getting a credit upgrade and refinancing 2013 debt while Bernanke is still printing $ and keeping interest rates low.
I think Sirius is only 2 notches below investment grade and an upgrade there would be a big jolt to the stock IMO.
Let me know your thoughts.
SXM….
The savings I stated considers the costs involved. if successful the move will save the company about $1 million
Remembering the Chinese proverb, “the first step is the start of 1,000 mile journey”, this is another step toward our destination.
Quarter to quarter, siri keeps moving in the right direction.
The Stern issue is over blown. These kind of law suits go on all the time. However, in this atmosphere of economic stress and the discovery of ridiculously high compensation to the already over privilged, it does not look good to the public to hear about a guy who has pocketed 500 million saying he was cheated.
exactly. I think Howard needs to spend a week on Skid Row with a $50/week allowance to humble him.
Spencer- can you give your thoughts on my above post ?
According to satellitereadioplaygraound, “After subtracting the premium that Sirius XM is paying of $735,000, the company will save $857,500”.
Hi Spencer – how’s the Auto sales looking for March? I didn’t see you mid-month report that you usually publish. Thanks in advance.
A great chance to buy SIRI cheap, I have been following this stock for many years and bad new does knock the stock price down a lot but always recovers. This is just another hurdle that we will pass and forget about soon remember the NASDAQ desisting issue that seems like a long time ago! Well it was only a year ago 🙂