Bankrupt satellite radio operator WorldSpace Inc said yesterday that its lender Liberty Satellite Radio has terminated transaction negotiations between the two companies. Liberty Satellite Radio, a unit of media mogul John Malone’s Liberty Media Corp, was widely expected to seek a strategic alliance between WorldSpace and Sirius XM Satellite Radio, the New York-based company in which it owns a significant stake. WorldSpace did not give any details of what the transaction negotiations were about. A Liberty Media spokeswoman declined to comment.
Through a subsidiary, Liberty Media bought up the debt of WorldSpace last year, leading to expectations that Malone would seek to combine Sirius and WorldSpace. Sirius has 18 million subscribers in North America while WorldSpace satellite radio’s subscribers are mainly in Asia and Africa. Malone rescued Sirius from a possible bankruptcy filing last year with a $520 million loan. In return Liberty secured a 40 percent equity stake in the company.
WorldSpace said in its statement that it now awaiting information from Liberty as to its expectations as WorldSpace’s secured lender with respect to the handling of Liberty’s collateral. The Silver Spring, Maryland, company said it is now planning for a potential de-commissioning of its satellites and reviewing its strategic alternatives in light of the termination of negotiations.
(Source: Reuters)
on Mar 17th, 2010 at 12:47
Liberty took a remarkably long time to see that Worldspace has absolutely no light at the end of its tunnel.