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So let me get this straight, Liberty gets 40% stake in Siri, for LOANING them 530m ? I thought they got it in exchange for the stake ???? so Siri doesnt have to pay it back....but wtf...so Liberty gets their money back and 40% stake in siri ? wats the deal, someone please enlighten me.
I don't know my friend. There seems to be a never ending supply of uncertainty with this stock. In fact, EVERY time we get the good news we've been waiting for....the MURKIER the future seems to get. Remember how we all waited for the "POP" after the merger and were rewarded with a 98% drop in value?
Now that the immediate threat of BK has been put to rest with the removal of the 2009 debt....we are left with the specter of MASSIVE dilution and Reverse Splits.
It NEVER seems to end with this stock. Good News = darker skies. Where is the "pop"? Where is the pay off for us long suffering longs? Will we EVER get some relief? The stem cell sector got great news today, and anyone in those stocks have the warm and fuzzies. It'll be up, Up UP for holders of those equities. That must be a GREAT feeling. To be CERTAIN your stock is going higher.
I only WISH I could have the same feeling of positive certainty with Sirius, but it seems no matter WHAT good news we get....the future is always uncertain. The skies always dark.
Will we EVER see blue skies?
I averaged down to a buck from $6 and still feel a million miles away from ever breaking even, let alone making a profit.
I was reading through these reports, and please step in and correct my errors but, my view leans toward Liberty owning the stake in the XM/SUB.Quote:
Originally Posted by omega_1
Not the parent company SIRI/XM, if that makes any sense!! The stake was taken in XM/SUB but if shares are converted into common then, dilution across the board? I am not sure? I think Mel Handed over the XM branch to Liberty for now, to get through this train wreck economy for now.
Its hard to interpret!! Wait for the CC, and we will see what is said. :)
Thats absolutely correct. He actually isnt loaning some of that money, I believe 100 million of it is just cash, and the rest is a loan. Yes, Mel robbed the company for a loan. It was a terrible deal then, and its a terrible deal now. But once again, we are accepting it, as its still slightly better than bkcy. I would have perfered the Ergen deal, as I believe it was all cash, and agreement to rework all bonds owed. Only problem is he didnt want Mel involved in the company. Thats pure rumor however. Only fact we really know about the Ergen deal, according to Ergen , was that yes, he did indead by SiriusXM debt, and was attempting to gain control of the company, EXACTLY LIKE MALONE DID, AND ACCOMPLISHED. One deal was turned down, the other accepted. Neither legally voted on, and Mel faked BKcy to get the deal done without petty stockholder approval. We know he faked the deal because hes been in negotiations with Malone since December, the day after minimum Ergen was negotiating with Mel. No reason to go to the 11th hour, as Mel discoverd the problem converting the Feb. bonds months ago. IF COH shows greater than 400 million, Mel had better talk quick. Hed better convince us he had to retire the entire year of debt then, as opposed to waiting, and since COH wasnt going to be enough for full payment of all 09debt(Ergen buying the bonds ensured this as he was refusing equity for debt swaps. He wanted cash, forcing Mel's hand"supposedly". None of this has ever been confirmed.Quote:
Originally Posted by omega_1
Since their plan to use shares to pay off debt failed, they went to the next best thing, a loan for shares. A HUGE 40% STAKE. All this was planned out, and Mel screwed us. Period. No way 11th hour Mels ever going to convince me this deal was necessary without enough time to get a vote through. BS.
Malone was seen as this "white knight". LOL Thats laughable. Everyone, every stockholder should hate him. He gets a 15% loan, cash, and 40% control for a simple loan. Mel negotiated this deal after months of effort. This is his "huge" deal. Offers ZERO advantage to stockholders, other than we arent in BK, which is all Mel wanted us to feel, grateful for him saving the company, which never was in jeopardy in the first place.. I would have told Malone to go get screwed, and Ergen, and told them they can both fight for scraps in BK court, you get nothing. Or someone come forward and present a reasonable offer. Maybe bring in a third party to scare the other two, even if the 3rd party was just smoke and mirrors. My grandmother could have orchestrated a better deal than this Malone POS, and shes been dead for years.
relmar, I posted this on the other thread I believe it is a little more logical.
Originally Posted by john
sl62, I have already said I dont think they even went into it. Considering the FCF positive for the last 2 years was growing by leaps. The cash burn will not even be there in the 4th quarter. They will most likely have added to it. I know I am not going to like it when they say they have 400, 500+, in COH. I am going to be pissed, because that means there were other options open. Now did Charles Frick alot of those options up, I think he did. I also think he forced Mels hand on alot of this bullshit. That if he would have kept his gruppy hands to himself then we would not have had to give up 40% of the company.
P.S. I know some are going to say well if they had that much COH then why did they say they were close to filing for BK. The reason was not just the Feb. debt but all the rest that was coming up. That when Charles came in the banks were now not so certain that extending the credit facilities with Mel in control was the best option. So now that means the COH was not going to be enough to cover both what was left in Feb. and the Bank debt due in May and still have enough to carry out business on a day to day basis.
I am not sure about this but I dont recall SIRIXM ever saying directly that BK was a possiblitity because of Feb. debt. They did say that BK was possible and that is why they did not need the shareholder vote. The point being that they ether needed to get this deal done or face the reality of May not getting extented. The deal was a here and now kind of thing that had to be done now and may not be there later.
This part was in response to cos1000 ignore if you want.
Now if you read the whole thing, then the last part of that was to show that they needed the Malone deal to get by the May debt also. The mention of BK if you recall was mentioned for the purpose of the Malone deal. I eluded that the only reason they needed Malone now was because Charles (DISH) F-d up the works by now giving the banks another option (most likely a better one) other then extending the credit with Mel. Mel brought in Malone to give the banks a totally different set of options. Which I believe were something like: You can fight it out in bankruptcy court to get pennies on the dollar or deal with Malone and SIRIXM. Basically Mel sweetend the pot just enough for the banks to choose him over the alternative.
So....this is the SECOND time then that Mel waited till the last possible moment to justify signing an "UGLY" deal?
Hmmm.
If it turns out that Sirius DOES have that much cash on hand(400 plus million)...there are going to be A LOT of pissed off shareholders.
Mel better use that money to buy back shares then. Cause if Mel waits till the last minute a 3rd time only to do an "UGLY" 1 for 50 Reverse Split....I'm gonna be REALLY PISSED. :-)
Quote:
Originally Posted by frigginregan
I know you read some of the post but you must have missed the other parts where it says why the COH was not going to be enough with Charles Fing the works up. Now because the Malone deal has taken care of most of the financing in 2009 you are asking what are they going to do with the COH. I will guess they still need it for the satellite that as of yet has not been pushed back from this Fall. Thats a good 240+ million for you.
They are going to have money. A lot of money. Read the press release. A lot of money came from Liberty to be used "for general corporate purposes."Quote:
Originally Posted by frigginregan
omega_1...Quote:
Originally Posted by omega_1
You have to look at this deal differently. You had two choices my friend: this deal or BK. Period. IMHO the Ergen deal (which we still don't and may never know all of those gory detais) was crap for this company. Granted it may have meant a limited short-term pop for shareholders to exit their positions, but afterward, this company would have been in the hands of uncertanty. I don't believe for a minute he wasn't playing for profit-only and would sek to dismantle this company piece by piece. I am happy with and would much rather have Liberty as our new partner. Unlke Ergen, John Malone and Liberty (who have a controlling stake in DTV) are winners and proven leaders. Certainly in the future there will be synergies betwen thw two companies, we just don't know them and to what extent yet. But in that case, who would you rather be partnered with? Direct TV or Dish Network? The difference between a leading company in its space and one that is not. I will take the leader. You mention the 40% stake in SIRI. Who cares?? I'm actually more comfortable this way. As said, why am I sad about a proven winner having a 40% stake in SIRI?? I'm not. I'm happy ecstatic about it. All that does, is ensures the future of SIRI will be bright no matter what. I love the fact that we are gaining two new BODs in Malone and Maffei. Again, two proven winners who can have a new voice in this company. LOVE THAT. Lastly to expand on my opening remark..This deal or BK. Ugly??? This deal consummation is no where near ugly. If you want to see ugly, go check out CHTR right now. You have to move on from the ugly thing. This is now the second major deal Mel K has engineered in 6 months (and during the roughest economic waters this country has ever seen). And it's clear to see this all has an end game. The deals may appear ugly but they are really nothing more than the evolution of this merger/LBO. Odds have been against this whole deal happening from FCC issues, now to new debt financing. Mel knew this was not a 'one step and we're done' process. He is doing this in the steps that need too happen over time. Remember this: THE STOCK MARKET HAS CRASHED!!!!! THE CREDIT MARKETS HAVE CRASHED!!!!! THE ECONOMY HAS CRASHED!!!!! We are right now livng through something even worse than 1929/30's in terms of percentages.. For Mel to release that deal news yesterday is NOTHING SHORT OF MIRACULOUS. There was one bullet in the gun and it hit its target. Only another satellite company was going to be available to help this through. Fortunately, Malone has DTV to create this impetus on his part. Very similar to Mel pulling XM away from NAB at the last minute. I suggest you reconsider the meaning of having Malone and Liberty not only as partners, but that they have their 40% stake. So what? Just gives this company that much more firepower at the helm. In the end I think you and all off us will see the results. IMHO... :D
Of the $280MM loaned to Sirius... $30MM went to Liberty for the deal, plus $172MM went to repurchase the Feb09 Bonds. That leaves $78MM for Sirius to use for "general corporate purposes".Quote:
Originally Posted by Brandon Matthews
I wouldn't call that a lot of money, IMHO.
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Instead of the stock being value at $2.00 some day, it will be valued at $1.11 some day. Gotta love dilution... but you are right. It was either this or the stock being valued at $0.00 some day.Quote:
Originally Posted by sl62
Take your pick.
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S162
"There was one bullet in the gun and it hit its target. "
I think that statement is the most accurate way to describe this.
Actually, you are both wrong. The CC will report Q4 numbers. None of this was done in Q4, so COH reported will not include this amount.Quote:
Originally Posted by homer
Regardless, I feel that this was a do or die option. I don't like it at all, but it was much better than the alternative (BK). I don't think the banks wanted to extend anything without being certain that Sirius could pay off the December debt, because it would have put them back a little bit further in line. Sirius would have had to put the BK message in the Coference call, because it would have been required by law. This would have sparked a short frenzy that would have killed us all. As much as I hate the deal, I think it was the only option.
Sl62..
:thumbsup:
Quick question, i just read what Brandon wrote in that article. What is he talking about 6 billion in tax credits ?? whats that about ?
omega: When you have an opperating loss for a business, you can take a tax credit. These tax credits are limited on a per-year basis, but any credit that you do not use can roll over. Basically, what Brandon is saying is that because of the heavy losses for the last many years, they have built up quite a tax credit that they can use in coming years when they start to generate a profit.
It is the same in your personal taxes. If you sell a stock for a loss, you can write a portion of that off. The amount you can write off is limited to something like 3,000 per year, depending on your income. If you sold Sirius in December 2008 for a massive loss (lets say 15,000), then you roll over the difference (12000) and can use that in 2009. Use 3000 in 2009, and you have 9000 left... and so on and so forth. Same concept. It cannot ALL be used at one time, but it will save the company a significant amount of money over the next many years.