Test For Echo – Ergen Gaining Leverage
With news reports swirling about Charles Ergen making a move for Sirius XM Radio, it has become hard for anyone to really know what is happening. Reports that Ergen tried to buy the company in late 2008 joined other stories that had him trying to force bankruptcy, and carrying an interest in the terrestrial repeater network. Amidst all of the confusion, shareholders find the equity price right back where it was prior to the news coming out.
Since the merger, and the collapse of share price i have been asked time and time again about the prospects of bankruptcy. My opinion was always the same. I believe in the concept of satellite radio, and was more worried about someone swooping in to buy the company cheap than I was about it going belly up.
Charles Ergen is doing something very basic. It does not require rocket science to see it, and once investors understand it, the clouds could begin to clear. Ergen is gaining leverage. He is covering his bases, and making the moves that will give him the best chance of reaching his desired goal. The real question at hand is not what Ergen is doing, but how Sirius XM Radio deals with the situation.
Now that the cat is out of the bag, Ergen has perhaps lost a bit of his leverage. The debt he has acquired is not enough to take control even if it were all converted to shares. He likely still needs to buy up shares on the open market, which could begin to drive up the share price. In addition, if other players are thinking of moves of their own, whether for profit reasons or competitive, then the dynamic could change even further.
If all of that was not enough to consider, there is the regulatory issue to think about. Will the democratic controlled FCC allow a satellite television player to become entrenched into satellite radio as well? Ergen is not only in a poker game with Sirius XM, but the FCC as well, and the stakes are high.
This will all play out over the coming weeks. Does Ergen have enough leverage? What will the company say in their next shareholder meeting? Shareholders, who have already been waiting for a long time to see a glimmer of hope now have to digest a possible take-over. Thankfully, it would be hard for this issue to drag on as long as the merger did.
Position – Long Sirius XM Radio
looks to be over–I have deductions from losses to last my life
I just dropped my two subscriptions and asked for a refund. Mel is a crook and we need to bring him to task.
I took this action after reading tonight that his lawyers are preparing BK papers and should be filed in the next several days. The stock just fell over 20%. Unbelievable considering they had a basic monopoly and a very good product. I will not be back after BK. I lost a great deal of money as others have as well. It is a sin that Mel will still make his. It was very disturbing to get wind to the fact that he did not act on the unsolicited offer in the summer of 2008 or take action on financing during the same time frame. What was his agenda? Does not seem to be with the stockholders interest in mind. Just to reinforce that there are those in this world that will step on others just to make their fortune. He needs to be held accountable for his actions.
This could be a bluff to make Ergen bid higher or backoff on what he wants.
If you read the NYT that is exactly the play at hand:
The threat of a possible bankruptcy filing could force Ergen to make a formal offer for the company now if he doesn’t want to go through an auction in bankruptcy court.
It could also compel him to agree to convert his debt into an ownership stake in Sirius at a higher price than he originally considered.
At least I am getting some entertainment on my penny shares while Ergen and Mel watch their millions go back and forth in the tug o’ war.. this is wild!
I don’t know if I’m just numb or in complete denial, but I still have hope that the stock will come out of it and not go to zero. Sell now after hours and I can save myself over 8k at 7 cents/share, but I don’t want to get sucked into the speculation & then we’ll here a bid for .50 cents or $ 1.00 share. Maybe I’m just still dreaming.
I feel the same way. Something just ain’t right here. This story was obviously leaked on purpose. It might be a very dangerous negotiating ploy. We will find out soon.
If it quacks like a duck…take your 8k
Oh…just END THIS F UCKING FIASCO already. 4 friggin years of the single WORST investment I’ve EVER made. 4 years of HELL.
At least it will be over soon.
Let me just say this….I blame MYSELF FIRST and foremost. I got into Sirius 4 years ago with the Stern news. I’m not even a huge Stern fan. At the time I got into it because I was disgusted with the crack down on civil rights. I thought it was a good play. But I bought it on impulse and hype.
I was about to get out in 2007….when suddenly they announce the merger. It was the first of MANY blown chances to get out. 18 months later we ALL know what happened.
Now I stood by Mel. I BELIEVED him when he did interview after interview saying his main concern was the shareholders. To not bet against him. On and on. I kept defending him to others.
Now I look back, and in the face of this sickening news thats even WORSE than the feeling I got when Mel cut that “UGLY” deal to close the merger and the stock began it’s plummet downward. Mel kept saying “NO BK!” “NO BK!”
I am sorry. It’s NOT THE ECONOMY. This is the single worst managing of a company that I’ve ever seen.
The worst part, is that ALL the insane taunts from the shorts have come true. We have not ONCE gotten relief. 18 months of hell with the merger. Now this.
Mel friggin lied. I am sorry. I took a gamble and I lost. But I never thought I’d go thru this hell.
ALl those conspiracy nuts were right. THat Hartleib dude was dead on.
I love the guys here at Sirius Buzz…but all the while they’ve been writing how they don’t think BK will happen. That we should take the WSJ articles with a grain of salt. To read between the lines.
Hey, I fell for it too. I soo wanted to believe in this company. But I’ve never felt more the fool in my life.
Now people are trying to say this is a Mel tactic. A head fake.
I’m sorry. I can’t believe it. THis smells like the end to me. I’ll be SHOCKED tomorrow if it doesn’t all come out to be true.
I am preparing to lose it all. Mel will start over and we…the ones who he said he was working for….the ones who supported the company thru it all….will lose everything.
And don’t give me that shit about Mel has money in the stock. CHUMP change for him. He’s going to walk away with MILLIONS. Yet we, the little guy….will lose it all.
The shorts were right. I am a complete a hole.
Two good things. One the pain will be over soon. No more clinging to hope. And two….I have learned the most valuable lesson in my life. I will NEVER make this mistake again. Cling to hope. I broke all my rules with this stock and paid the price.
ARGH!!!!!!
I am sure I’ll vent some more….but I am FRIGGIN PISSED MAN. If this be true…and it look like it is. GAME OVER. WE LOST. MEL WINS. THE BIG DOUCHE.
I don’t know what the hell is going to happen, but I know this: Last week when news broke that Ergen was aquiring the debt the stock took off like a bat out of hell in the pre-market only to come crashing back down. Now we have news that is causing the stock to tank in AH, what will tomorrow bring? It wouldn’t surprise me one bit if we end tomorrow higher than today’s close. Keep in mind that “preparing” a BK filing is not the same thing as filing for BK. People “prepare” alot of things that never come to fruition.
well at least we dont have to follow this lame coverage on this site anymore. These r the biggest happenings this stock has ever seen and suddenly sparse reporting from tyler and the other ladies. You three have been wrong on almost every front this stock has seen. What r the chances of BK now Tyler?
kevin…..
“well at least we dont have to follow this lame coverage on this site anymore.”
You never had to follow it, nor did you ever have to participate in the site. No one here was forcing you to follow anything on this site.
“These r the biggest happenings this stock has ever seen and suddenly sparse reporting from tyler and the other ladies.”
1. Do you want me to parrot the news, or try to dig a bit deeper? There will be coverage from this site on the subject in short order.
2. If you need to stoop to name calling with the “ladies” comment, you have already lost the debate, and lost any credibity in it. You may want to keep that in mind for future reference.
“You three have been wrong on almost every front this stock has seen. What r the chances of BK now Tyler?”
1. A statement with nothing to substantiate it.
2. Bankruptcy is an option. I have spoken many times that it would be prudent for the company to have it as one of several plans. They would be foolish had they not considered this option. Will it happen? Time will tell.
I bought in at $3.78 and sold at $6.30 (on its way back down)and never looked back. When that stock plummeted from .90, .80, .70, .60 CENTS, I still heard buy, buy, buy…
Gas was at $4.10/gallon and the SIRI stock was at .40 cents I knew the death blow was coming..
The winner is….. The NAB!
Hey Kevin. You can’t blame Tyler and Brandon for keeping hope alive. We all were hopeful. Otherwise we wouldn’t have still been in the stock. We took a gamble and lost.
I guess Tyler and the gang are laying low to see how this thing plays out before commenting. Although…I do agree, back in the day, they’d be posting 5 times a day if buzz like this was going on.
I think we’re all just tired. I wanted to believe Tyler and Brandon’s positive spin on the WSJ rumors….but now that the NY Times is coming out with a “rumor” of it’s own….things ain’t looking good for the hopeful.
Looks like our worst fear is coming true.
I know the Sirius Buzz gang have consistently said they NEVER wanted to see a buyout….but I guess if…and I mean a BIG HUGE IF….if Mel is bluffing and trying to force EchoStars hand or to start a bidding war to at least leave the shareholders with SOMETHING….I’d take that over BK ANYDAY.
I guess this is our LAST bit of hope. But I can’t even muster the words. With all this news coming out….Mel HAS TO SPEAK this week. So the good news is we will find out by Friday I would imagine. After 4 years of waiting….at least the end of this pain is FINALLY near.
Sirius is down to a nickel a share in after-hours trading.
A. Nickel. Per. Share.
$0.05
Who are you bullshit—. Never got to .05
On a day filled with tremendous promise about the Treasury’s approach to taking toxic debt off the balance sheets of Banks, then the disappointment and lackluster performance of the new Treasury Secretary, this “story” about the preparation by lawyers for SiriusXM of papers for filing BK seems, on the surface, to be orchestrated for taking advantage of a down day in the markets.
With but a week to go until the 30-day grace period begins on the Feb. financing, a warning story of sorts is posted after hours… No verifiable “source”, from N.Y. Times, and no actionable event… hmmmmm Sounds like the N.Y. establishment is playing still, with the future of this company.
Lots of charlatans running around these days, but Melvin has been running around the truth since he arrived at Sirius. His tenure at both companies has produced debt, and lots of it. I’ve asked this question many times before, and now the answer is getting clearer… the question was: “How does Melvin keep his job?” Answer: His job is almost finished. A shyster who was hired to do only one thing and we are witnessing what that mission really was via this after-hours story.
With CEO’s such as Karmazin, a rescinded UpTick Rule on Shorting and now a rooking Administration complete with tax-evading nincompoops heading up the Treasury Department, its a wonder that any company’s stock will rise. Its as if the entire Market is being dominated by those who would see each opportunity for growth to be the catalyst for destroying the same. I’m perplexed, concerned and disgruntled by it all. And, proudly, I am Not a Short Seller.
If there is one bright spot in all this, I would conclude that if indeed this company does do the BK dance, then Howie will also be taking a 40% haircut as the final two years of his contract will be nullified. That, my friends, is how I feel and see it at 9:25 p.m. EST, on Tuesday, February 10, 2009 (just about three years to the date that Howie received his outrageous 1st bonus, btw and the beginning of the total downward spiral of the PPS for the previous Sirius Radio, of which there was never a reversal.)
My closing remarks would be for Melvin… with today’s reporting of the potential BK of SiriusXM, your legacy as a Captain of Industry has come to an end. With your complete and utter disregard for the shareholders you have exhibited what most Americans are finding increasingly intolerable in their so-called leaders: lack of accountability and selfishness. My subscription(s) and hardware will be cancelled and destroyed on the day of the filing.
I will now support a defeated 83-year old (my father) who recently lost his wife, and now his wealth, as a result of putting his faith in your promises. Go, Melvin, and kiss the rear-ends of those who put you in this Role to do this deed. You shouldn’t have too much problem with that task, either.
It ain’t over ’til it’s over…
Scott Greensteen said today “trust Mel”. I personally do not trust anyone with white capped teeth; but there is a part of me that still has hope…even if it is false hope.
I got Sirius for Stern, but have since fallen in love with Radio Classics (Sirius 108), Stephanie Miller, Left of Center, Kids Place (for the kids) and so on and so on.
I bought close to 3ooo shares at 3.85 which are now worth about $300. I had lost everything several months ago. I am not happy about it, but now more concerned about the medium as a whole. I still want to wake up and drive to work with Howard, Artie, and Robin.
It’s not a done deal. It’s not yet over.
Something is rotten in Denmark here.
A few things really stand out in my mind:
1) Sirius likely has about 350 Million in cash on hand
2) Mel said he would handle 1 hurdle at a time (here’s # 1)
3) I can’t believe he would go down like this, this easy, this quiet after all he has said.
4) Ergen may bend a little & offer up an ok bid if he really believes Mel would file to keep his hands off the company.
5) This is not news that they are preparing bankruptcy papers -it is an option and a weapon (just not a shareholder friendly one)
6) Mel said the shorts would get hurt if they bet against him – so far he’s been wrong, but could he pull a rabbit out of his sleeve ?
7) Doesn’t he have any other offers, friends in the business to that would want to get a piece of company & help a brother out !
…agreed. I could’t exactly put my finger on it, but something seemed a bit …odd about the WSJ report. I could be way off here, but it just seemed like a well placed ad. Maybe I want to see it that way, because I have a financial emotion attached to this. I seem to be rambling now, but the story just seemed a bit “odd” to me.
Max,
“Shyster” – that pretty much says it all! It makes you lose faith in the human race. To mel and all of his cronies, I have one simple question; why the utter contempt for the subscribers?
It was just a matter of time before their complete betrayal of the subs and shareholders would lead to this companies downfall. Unfortunately, it’s the little guys who get screwed the most. That’s the American way, isn’t it?
What can I say after what everyone else has said since the BS talking heads article via the NYT.
IMO..this is a ploy that has everyone in panic mode so a huge selloff could happen. I imagine that this is Mel’s way of trying to pressure the holders of all debt due. It might work.
I would think that all the institutional holders would have dumped as well and the AH trading volume would have been in the billions not just 12 million. It traded in last few days over 100 million shares on all the rumors.
No matter what I will hold my small investment of $12,000. (avg .59) and wait and see over the next few days what happens.
Really thinking that BK is not a reality…JUST A WISE THREAT to shake things up and shake out the scared holders. Mel will leverage this threat to get funding completed and F&@K all the NON-BELIEVERS!!! REMEMBER Mel loves to gloat and smurk. He wants to comeback as the hero of the year in such a big way…especially during a disasterous market. This will feed his ego even more and he can tell everyone …I told you so…don’t mess with Mel.
yep they screwed up BIG TIME
fuck Mel and those bastards who stole this company from us….
I’m out 60,000.00
the sad part is that sirius will survive, just as a company that was stolen from us shareholders who funded it.
mother fucking cock sucking Mel!!!!! I will fucking spit in his face if i ever see him on the street.
I hope he goes to prison.
What did you expect from a bunch of j-ws. Mel took a small fortune from this co. Friends included.
the funny thing is Howard will get completely screwed. they were talking about this today on the show and you could tell that they have no clue how screwed they are!!!
It’s sort of funny. at least im not the only one getting shafted here.