Sirius XM Holdings Inc. Tuesday acknowledged that the special committee of independent directors of the board of SiriusXM received a non-binding proposal from Liberty Media Corporation regarding a potential transaction involving the Company. The potential transaction would consist of the separation of the assets and liabilities attributed to the Liberty SiriusXM tracking stock group from Liberty Media through the split-off of a newly formed company ("Newco") and the subsequent combination of Newco and SiriusXM, as a result of which the holders of Liberty SiriusXM tracking stock and SiriusXM common stock would all hold one class of common stock of the combined company (the "Proposal").
The Special Committee, together with its advisors, Solomon Partners Securities, LLC and Debevoise & Plimpton LLP, is evaluating the Proposal. There can be no assurance that the Proposal, or any other transaction, will be completed or, if so, as to the terms and conditions of any such transaction. The Company does not intend to disclose developments with respect to this matter until such time as the Special Committee and the Company's board of directors approves a transaction or the Special Committee otherwise deems further disclosure appropriate, except as required by law or other regulatory requirements.
Nothing in this communication shall constitute a solicitation to buy or an offer to sell shares of SiriusXM's common stock. The Company cautions stockholders and others considering trading in its securities that the Special Committee has only received the Proposal from Liberty Media and no decisions have been made by the Special Committee with respect to a response to the Proposal.
Liberty’s business stakes and interests are attributed to three tracking stocks, designed to track the performance of different businesses: Liberty SiriusXM Group, Formula One Group, and Liberty Live Group. The Liberty SiriusXM Group tracking stock is listed under the ticker symbol LSXM, while SiriusXM’s stock market listing is under ticker symbol SIRI.
The minority shareholders of SiriusXM would collectively own approximately 16 percent of what is dubbed “New SiriusXM” once the deal closes, with the holders of LSXM stock collectively owning approximately 84 percent, the firm said on Tuesday.
“Liberty’s proposal rationalizes the dual corporate structure between LSXM and SiriusXM and provides value to all shareholders with a more flexible and attractive currency in New SiriusXM,” said Maffei. “SiriusXM minority shareholders will also benefit from enhanced trading dynamics, including increased liquidity and likelihood of future index inclusion.”
He concluded: “We are excited about the prospects for New SiriusXM and look forward to remaining meaningfully invested in the business. This simplified structure will also allow management to better focus on its strategic priorities, drive the company’s continued growth and simplify the investor relations story.”
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