If Sirius Files, Karmazin Fired Creditors Threaten

A group of disgruntled Sirius creditors has threatened to fire Mel Karmazin and other senior execs if the company does not cut a deal with EchoStar or John Malone (who has offered to provide bridge financing) and instead files for bankruptcy. Edward Weisfelner, a lawyer with Brown Rudnick was quoted as saying:

"Creditors believe that a precipitous bankruptcy filing will not be in their best interests. Our group is concerned that management not use the threat of bankruptcy as a negotiating tool. Creditors will act quickly and definitively if they perceive that management is acting in their own interest and not in the best interest of the estate. The board of directors should carefully consider the ramifications."

Additionally, following in Lazard's footsteps, the creditors have threatened to ask for the appointment of an independent trustee. The company is expected to file for bankruptcy tomorrow so this is likely merely last minute posturing. The bondholder group is rumored to hold a mere $173 million of Sirius' over $3 billion in total debt, so it unlikely that they will have much if any leverage in ongoing negotiations. Sphere: Related Content

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