Charlie Ergen’s satellite firm EchoStar (SATS) has built up a big chunk of satellite radio monopolist Sirius XM’s (SIRI) debt, according to the Wall Street Journal. This could be an attempt to take control of the company.
Why would EchoStar want Sirius? It’s not growing much on its own — analysts expect the company to grow sales just 0.2% this year to $2.22 billion. (EchoStar spun off Dish Networks last year. That company isn’t growing much, either.)
So what could EchoStar do with Sirius? PaidContent’s Rory Maher has two ideas: Run the company on its own — once Sirius has a clean balance sheet, it’s in better shape — although growth is shrinking and competition is increasing. Or use Sirius’s assets — spectrum licenses, terrestrial repeaters — for some sort of broadband Internet service.
Interesting idea, but any wireless Internet service would have a tremendous amount of competition from cellular companies, Clearwire (CLWR), etc.
Sirius shares jumped 16% to $0.165 today. They’re down 96% from their 52-week high.
Business Insider Emails & Alerts
Site highlights each day to your inbox.