Recapitalization strengthens Sirius balance sheet

| 3/13/2003

Satellite radio broadcaster Sirius announced March 5 that a majority of its stockholders has approved its $1.2 billion recapitalization.

As part of the recapitalization project, 91 percent of Sirius’s debt holders have agreed to exchange their debt for common stock. Additionally, the company’s preferred stock will be exchanged for common stock, and the recapitalization will inject $200 million in new capital from the company’s major financial partners through the sale of newly issued common stock.

“This is a major milestone for Sirius that now enables us to move forward with a strong balance sheet,” Joseph P. Clayton, president and CEO of Sirius, said. “With our commercial-free music and additional products coming online this year, including portable Plug & Play and in-home units, and with our car manufacturer programs taking shape, we believe that 2003 will be defining year for Sirius, and a catalyst for long-term success.”

Upon completion of all transactions, expected this week, the recapitalization will convert about $636 million in debt and $519 million in preferred stock into common stock.

--by Rene Tankersley, feature editor