Sirius XM Hires Financial, Legal Advisors To Evaluate Liberty Media Proposal

(RTTNews) - Radio broadcaster Sirius XM Holdings Inc. (SIRI) said Friday the Special Committee of its Board has retained Evercore Group L.L.C. as financial advisor and Weil, Gotshal & Manges LLP as legal counsel in connection with its evaluation of Liberty Media Corp.'s (LMCA, LMCB) proposal to acquire all of the outstanding common shares of Sirius not owned by Liberty.

Sirius formed the Special Committee, comprised entirely of independent directors not affiliated with Liberty, following Sirius' receipt of Liberty Media's proposal earlier this month.

The Special Committee intends to work with its advisors to, among other things, review and evaluate whether the Liberty proposal is in the best interests of Sirius and its stockholders, other than Liberty.

In addition, in light of Sirius's receipt of Liberty's proposal, the Special Committee has authorized Sirius to enter into an agreement with Liberty to defer the previously scheduled $240 million repurchase of shares of Sirius common stock from Liberty from January 27, 2014 to April 25, 2014.

As a result of this deferral, Sirius will repurchase $340 million of its shares of common stock from Liberty on April 25, 2014 at a price of $3.66 per share.

Sirius cautions that no decisions have been made by the Board or the Special Committee with respect to Liberty's proposal.

Sirius is the world's largest radio broadcaster measured by revenue and has 25.6 million subscribers.

On January 3, billionaire John Malone-controlled Liberty made a proposal to Sirius by which Sirius public shareholders would become shareholders of Liberty in a tax-free deal in which each share of Sirius common stock would be converted into 0.0760 of a new share of Liberty Series C common stock.

Immediately prior to the conversion, Liberty plans to distribute, on a 2:1 basis, shares of its Series C common stock to all holders of record of Liberty's Series A and B common stock to create a liquid trading market for Liberty's Series C common stock.

Upon the completion of the proposed deal, Liberty expects that Sirius' public shareholders would own about 39% of Liberty's then-outstanding common stock.

The Series C common stock would be Liberty's largest and most liquid series of stock. The proposed exchange ratio of 0.0760 would value Sirius common shares at about $3.68 per share based on closing prices of Liberty's Series A shares on Friday January 3.

Liberty became Sirius' largest shareholder in 2009 after it gave the company a $530 million loan to help it stave off bankruptcy.

In January 2013, Liberty bought a further 50 million shares of common stock in Sirius to raise its holdings in the satellite radio company to just over a majority stake.

Sirius XM shares closed Friday at $3.64, down $0.08 or 2.15%, on a volume of 59 million shares on the Nasdaq. In after hours, the stock dropped $0.02 or 0.55%.