According to a June 17 SEC filing, SiriusXM has made significant changes to its existing agreements concerning its upcoming reorganization and merger with Liberty Media Corporation, including a reverse stock split.
The amendments, made to both the Reorganization Agreement and the Merger Agreement, are primarily aimed at modifying the exchange ratios to reduce the number of New Sirius common stock issued post-transaction.
Under the revised terms, SiriusXM shareholders will now receive one share of New Sirius for every ten shares of SiriusXM held, a substantial reduction compared to the initial 1:1 terms, adjusted for net liabilities. This reverse stock split is designed to maintain the economic balance of the transaction while reducing the overall share count, enhancing the share price of New Sirius common stock post-closure.
The revisions were approved by the Liberty Board of Directors, the SiriusXM Special Committee, and SiriusXM’s Board of Directors, aiming to better align the nominal share prices post-transaction and improve the stock’s market dynamics, potentially increasing its appeal to investors.
To facilitate the restructuring, Sirius XM Radio Inc. plans to convert into a Delaware limited liability company, pending regulatory approval under the Communications Act of 1934. The process remains expected to close in the third quarter of 2024.
In an April 30 earnings call, SiriusXM CEO Jennifer Witz acknowledged challenges with the launch of its new streaming app, but remained optimistic about the platform’s enhancements aimed at attracting a younger audience
