Friday, February 13, 2009

Sirius To File Bankruptcy By February 17 If Exchange Offer Fails

Sirius XM just filed this press release stating that unless it manages to complete an exchange offer of its 10% Convertible Notes due 2009 for a like amount of Senior Secured Notesw due 2011, it will have to file for bankruptcy. The exchange of the $400 million issue has already been accepted by holders of $172.5 million, or less than half the total. EchoStar's Charlie Ergen likely holds a blocking stake in the issue, so the fate of Sirius is likely in his hands, and as such as bankruptcy filing on Tueday of next week is very likely.

The press release states:

The exchange of 10% Convertible Senior Notes due 2009 for new Senior Secured Notes is part of a larger restructuring effort. The Company is in discussions with others with respect to transactions that could refinance some of its and its subsidiaries' indebtedness. These transactions may not be successfully consummated. If these transactions are not consummated, it may be forced to file for bankruptcy protection as early as February 17, 2009.
More details on the full exchange offer are to be filed later today in an 8K. Sphere: Related Content
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