Englewood, CO, United States (4E) – Liberty Media announced on Friday that it plans to acquire the 48 percent of Sirius it does not already own in a $10bn all-stock deal, designed to convert the satellite radio company into a wholly owned subsidiary of the conglomerate.
The billionaire John Malone-controlled Liberty proposed to offer Liberty common stock to SiriusXM Holdings minority shareholders in a tax-free deal.
During the financial crisis, Liberty provided a multimillion-dollar loan to Sirius and got a large equity stake in return. Liberty has raised that position in recent years, and in 2012 gained complete control of the company, and forced out its former CEO, Mel Karmazin.
SiriusXM said in a statement that its board would create a special committee that will look into the Colorado-based Liberty’s proposal.
The plan involves SiriusXM common shareholders getting new Liberty Series C shares, in which Liberty would be offering with slight premium, at 4.5 percent over Friday’s closing price of SiriusXM stock.
Liberty chief executive officer Greg Maffei said the deal would provide both companies the financial flexibility they need to pursue other deals.
The SiriusXM deal is not the only major transaction Liberty is working on. Cable operator Charter Communications, in which Liberty has a huge stake, is planning to acquire Time Warner Cable in a multibillion-dollar bid.