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SkyREPORT - January 7, 2009
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Other articles from the 01/07/2009 issue: |
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Sirius Makes Move on Debt
1/6/2009 @ 2:45 PM
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Sirius XM made an attempt to address some of its money issues this week, conducting a money move before some of its outstanding debt obligations become due.
In a Securities and Exchange Commission filing, Sirius said it issued 45.2 million shares of its common stock in exchange for $6 million in convertible notes owned by institutional holders. After the exchange, $187.588 million in that debt remains outstanding, the company said.
The notes will be retired and canceled. As for its official line, Sirius said it executed the transaction to reduce debt and interest cost, increase equity and improve its balance sheet. The company stated in the SEC filing that it may engage in additional exchanges "in respect of outstanding indebtedness if and as favorable opportunities arise."
In addition to the notes due in February, Sirius has $350 million due in May and another $400 million by year's end, stated news reports.
While Sirius continues to eye its debt, Moody's Investors Service downgraded the satellite radio company's probability of default rating and its corporate family rating to Ca from Caa1, citing the debt coming due this year, along with liquidity problems cited by Moody's.
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