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Empresas y finanzas

Sirius reworks some debt, but bankruptcy still possible


    NEW YORK (Reuters) - Sirius XM Radio said its XM Satellite has refinanced some of its outstanding debt, but acknowledged the pay-radio provider may file for bankruptcy protection as soon as Tuesday.

    Sirius, under pressure to address some $1 billion in debt this year, said on Friday it exchanged $172.5 million aggregate principal amount of senior notes due December 2009 for newly issued notes due in June 2011.

    The New York-based company added that it is in talks to refinance some of its other debt, but didn't disclose the parties involved.

    However, a source familiar with the talks said on Friday that discussions with Liberty Media were friendly and don't include buying out Sirius' equity. Any possible agreement could include a loan to Sirius, paying off its debt, or assuming the debt obligations, the source said.

    Another person familiar with the talks said discussions with both EchoStar Corp and Liberty Media continue to be intense. Talks with EchoStar are more of a hostile nature, but a winning party remains uncertain, the people said.

    A possible Liberty investment could pave the way for a takeover, once Sirius addresses its debt problems.

    Charlie Ergen, the majority owner of satellite television company EchoStar and its sister company Dish Network Corp, holds $175 million in Sirius convertible notes that mature next week, according to media reports.

    Sirius also has $350 million of secured bank debt due in May 2009. After the refinancing announced on Friday, it still has about $227.5 million outstanding on its debt due in December.

    If the talks fail, Sirius -- home to programs by personalities including Howard Stern and Oprah Winfrey as well as Major League Baseball -- may file for bankruptcy.

    "These transactions may not be successfully consummated," the company said in a statement. "If these transactions are not consummated, it may be forced to file for bankruptcy protection as early as February 17, 2009."

    Sirius, which has a total debt load of about $3.25 billion, began planning to refinance its debt following its merger with rival satellite-radio operator XM, which was approved last July. But the credit markets froze shortly thereafter.

    Shares of Sirius rose 3 cents, or about 43 percent, to 10.6 cents on Nasdaq at mid-afternoon. Sirius shares have lost nearly all their value since Sirius Satellite Radio completed its acquisition of XM in July.

    (Reporting by Franklin Paul; Additional reporting by Yinka Adegoke, and Jui Chakravorty; Editing by Brian Moss, Richard Chang)

    (Franklin.Paul@thomsonreuters.com; +1 646 223 6195; Reuters Messaging: Franklin.Paul.reuters.com@reuters.net)