Sirius XM preparing to file Bankruptcy

Sirius XM preparing to file Bankruptcy

Posted on Feb 10, 2009 in News & Views by PMC Comments Off

Sirius XM Radion may file for Chapter 11 bankruptcy protection “within days,” according to a published report late Tuesday, as the satellite radio company continues to grapple with outstanding debt.

According to a report in The New York Times, Sirius XM has been working with the restructuring expert Joseph Bondi of Alvarez & Marsal and the bankruptcy lawyer Mark Thompson of Simpson Thatcher & Bartlett to help prepare a Chapter 11 filing. The report cited people close to the company, who said documents and analysis are close to being completed and a filing could come within days.
After gaining 3.6% during Tuesday’s down session, shares of Sirius XM were lower by 2% after hours to 11 cents a share.

The Times report comes one week before a chunk of Sirius XM’s maturing debt will come due. Sirius XM reduced its total debt due on Feb. 17 to about $175 million, but the future is a bit unclear. The company still has approximately $3.4 billion in debt, with just under $1 billion due before the end of the year, and its stock has fallen sharply since the July merger between Sirius Satellite Radio and XM Satellite Radio.

Tags: Economy, XM-Sirius