Liberty Media Possibly Adding Stake In Sirius XM/Early Anti-Trust Clearance Requested

By Relmor Demitrius

A recent update on the Federal Trade Commission website shows Liberty Media (NASDAQ:LINTA)  purchasing a given amount of Sirius XM Radio (NASDAQ:SIRI).  They have requested early FTC clearance on some type of transaction.  These requests are required to be posted on the FTC website.   The total amounts if any are not known at this time, but some type of purchase seems to be coming or has been executed.  It might be anything from a small amount of 5% or so, to a bid for the entire company, if the board were to approve such a transaction.  There are strict buying guidelines in place on how much of Sirius XM Liberty can own right now, including an agreement to not purchase more than 49.9% until early 2011.  After that and until early 2012 they must make an offer for the entire company.  Past early 2012 they can make an offer for any given amount, including the entire company, which would also be the 3 years needed for a change of ownership to reset the tax loss (NOL’s) on Sirius XM that triggered upon the first change of ownership, the merger between Sirius Satellite Radio and XM Satellite Radio that occurred in July of 2008.

I don’t expect a complete buyout offer or an offer that exceeds 49.9% of the company, as that would trigger a reset to 50% of the NOL value, and remove billions in taxable losses.

More likely a 5 to 9.9% purchase was executed recently.

Long SIRI