Sirius XM Receives Loan, Avoids Bankruptcy

Sirius XM Radio is avoiding bankruptcy through a $530 million loan from Liberty Media, the company which owns DirecTV and television outlets including QVC and Discovery. In exchange for the money, Sirius is giving Liberty 40 percent of its common stock as well as seats on its board of directors. The loan will be used to pay off the satcaster’s $175 million in debt that is due today, to pay debts coming due in May and at the end of the year, and for the general running of operations.

The first phase of the plan includes a $280 million senior secured loan from Liberty to SIRIUS XM, $250 million of which will be funded today. The second phase provides an additional loan of $150 million to XM Satellite Radio, SIRIUS XM’s wholly owned subsidiary.

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Sarah Skates has worked in the music business for more than a decade and is a longtime contributor to MusicRow.

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