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Liberty Media (NASDAQ:LMCA) is another step closer to taking control of Sirius XM Radio (NASDAQ:SIRI) after raising its stake in the satellite radio to 48 percent. In a regulatory filing, John Malone’s Liberty said it had bought about 90 million Sirius shares for roughly $2.50 each, or approximately $225 million in total, according to the Wall Street Journal. Liberty added that it had also agreed to buy an additional 41 million shares through a forward agreement that expires on October 11. Combined, all the transactions will raise Liberty’s stake from 46.2 percent to close to 48 percent.
Liberty will get clear control of Sirius if it manages to raise its stake to over 50 percent.
The two companies have been in an uneasy battle over the satellite radio operator’s control in the last few months. Earlier this year, Liberty asked the U.S. Federal Communications Commission for permission to exercise effective control of the company, but was denied by the regulator after Sirius opposed the application. Liberty has filed a second petition and is waiting for an answer. Sirius chief executive Mel Karmazin has been vocal in his opposition to giving up control, saying Liberty must pay a premium for it.
Liberty (NASDAQ:LMCA) was originally given a 40 percent stake in Sirius (NASDAQ:SIRI) in the form of preferred shares in 2009, after it rescued the latter from possible bankruptcy with a loan. Last week, Liberty said it would spin off its Starz division to help free up cash to pursue Sirius and other deals.
Shares of Sirius (NASDAQ:SIRI) finished Friday at $2.56 per share.
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