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When Liberty Media (NASDAQ:LMCA) first purchased its stake in Sirius XM (NASDAQ:SIRI) in 2009, the world was a much different place, and the company a very different business. When Liberty Media’s original Investment Agreement was dated and signed that March, the country was near the trough of the financial crisis and Sirius’s stock had fallen to $0.05 per share in anticipation that the company would be forced to file for bankruptcy.
But three years can make quite a difference. On November 1, Sirius released its third-quarter earnings report showing that the company’s average revenue-per-subscriber had increased and revenue had beat analysts expectations by $2 million.
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Despite the growth the company is experiencing, its future remains unknown.
Not only has the company has not yet found a replacement for its Chief Executive Officer Mel Karmazin, who will leave the company at the beginning of the year, Liberty Media’s intention to acquire a controlling stake in the company is still pending. The company, which also owns stakes in Barnes and Noble (NYSE:BKS), the concert promoter Live Nation Entertainment (NYSE:LYV), and the television company Discovery Communications (NASDAQ:DISCA), purchased 40 percent of Sirius in 2009. Liberty received its stake in Sirius after providing a $530 million dollar loan to stave off the company’s bankruptcy. Liberty increased its stake to 49 percent in September, and in August submitted a filing with the Federal Communications Commission to increase its stake beyond 50 percent.
Liberty Media will most likely be granted permission by the FCC to take a controlling interest in the Internet radio broadcaster; the comment period will end on November 20, and then the FCC will take several weeks before coming to a decision. According to a recent article from ValueWalk, only one petition has been filed against the acquisition.
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