Sirius XM Shareholders Authorize Reverse Split

Forevernever said:
4.5 billion shares at 12 cents = $540 million. At this point, Howard could easily buy a controlling share in SiriXM, and maybe even buy it outright! I hate to say it, but this company is toast. Lets hope that whoever ends up buying them doesn't screw with the nature of the service too much. One other bad thing about this is that there is no way Howard will be resigning, at least not with SiriXM. They don't have the money to pay him, and even if they did, any hint that they might offer him another half-billion dollar contract would sink the stock. Its going to be a drastically scaled-back show (which won't work, IMO), or back to terrestrial.
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I've been reading more and trying to figure out how much they are diluting the stock. I can't seem to find a straight answer. The 8 billion total might have been incorrect, I have a feeling they are able to issue up to 3.5 billion more, which would make a total of 7 billion.

But, I do not see the market cap increasing by issuing more shares. They want Share holders to cough up more money, to help the company survive. Unfortunately a lot of the shareholders are pretty dissapointed with how much money they have already lost, and I just don't see the extra shares selling like hotcakes.
 
Scales said:
I've been reading more and trying to figure out how much they are diluting the stock. I can't seem to find a straight answer. The 8 billion total might have been incorrect, I have a feeling they are able to issue up to 3.5 billion more, which would make a total of 7 billion.

But, I do not see the market cap increasing by issuing more shares. They want Share holders to cough up more money, to help the company survive. Unfortunately a lot of the shareholders are pretty dissapointed with how much money they have already lost, and I just don't see the extra shares selling like hotcakes.
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Remember, though, this is a reverse split, so the share price goes up, but the floated shares reduces by a similar ratio. The market cap stay the same on those shares.

Then they sell the additional shares at the market price, which they're hoping will stay close to the higher price, which then dilutes the market cap of all of the outstanding shares, and the company.
 
HomieG said:
Remember, though, this is a reverse split, so the share price goes up, but the floated shares reduces by a similar ratio. The market cap stay the same on those shares.

Then they sell the additional shares at the market price, which they're hoping will stay close to the higher price, which then dilutes the market cap of all of the outstanding shares, and the company.
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I wasn't referencing the reverse split, I was talking about the measure to issue additional shares. I am assuming they are going to issue the extra shares before doing a reverse split, as the wording indicates they could increase the number of shares to 8 billion in total.

The reverse split will not create more shares, it will create less shares which will be worth more per share, and hopefully prevent delisting by nasdaq. They have until December 2009 to do the reverse split, and if the nasdaq pushes the deadline back even further, sirius might not do a reverse split next year.
 
Scales said:
I wasn't referencing the reverse split, I was talking about the measure to issue additional shares. I am assuming they are going to issue the extra shares before doing a reverse split, as the wording indicates they could increase the number of shares to 8 billion in total.

The reverse split will not create more shares, it will create less shares which will be worth more per share, and hopefully prevent delisting by nasdaq. They have until December 2009 to do the reverse split, and if the nasdaq pushes the deadline back even further, sirius might not do a reverse split next year.
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I didn't say the reverse split would create more shares, in fact I said just the opposite ("but the floated shares reduces by a similar ratio").

We'll probably see that the reverse-split will occur first, then Sirius will try to sell the 3.5 Billion additional shares at a higher price sometime in the future. That will dilute the market cap.

In any event, it's all probably a lame attempt at window dressing.
 
HomieG said:
We'll probably see that the reverse-split will occur first, then Sirius will try to sell the 3.5 Billion additional shares at a higher price sometime in the future. That will dilute the market cap.
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But, It won't be 3.5 billion shares after the reverse split, if they do one.

They don't need to do the reverse split yet, but they need to come up with money for their debt. Issuing more shares for sale is one way they plan to do that.

I'm not sure how the extra shares work, if they just issue them as they are able to sell them, or if they will issue them all at once, and hope they sell. I would think if they issue them all at once, the price per share would tank fast, and that would make people more hesitant to buy any shares, but cause people to want to sell.
 
I'm not sure how that works, because 108 million shares for 15.6 million dollars works out to something like 14 cents per share, which is pretty good I would have thought.
 
Scales said:
I'm not sure how that works, because 108 million shares for 15.6 million dollars works out to something like 14 cents per share, which is pretty good I would have thought.
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You're right - that release must have had a typo in it. I read elsewhere that the stocks were valued at .14 in the exchange, which is actually a 2 cent premium over today's close at 12 cents.

SiriXM was downgraded to Ca credit rating today:

Moody's downgrades Sirius to "Ca": Financial News - Yahoo! Finance
 
At 12 cents a share, I'm surprised someone like Microsoft does not buy up sirius. For someone to put all those birds in the sky it would cost much more.
 
me_rubin said:
At 12 cents a share, I'm surprised someone like Microsoft does not buy up sirius. For someone to put all those birds in the sky it would cost much more.
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What does it take to re-purpose a satellite? Or would we hear the "PC vs. Mac Guy Show"
 
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