* John Malone company has 40 pct Sirius XM stake
* Liberty Media claimed de facto control over Sirius XM
* FCC dismisses Liberty Media application
By Liana B. Baker
May 5 A federal regulator dismissed John
Malone's Liberty Media Corp's application to take
control of Sirius XM Radio Inc with its current stake
of 40 percent.
Friday's decision by the U.S. Federal Communications
Commission came after Liberty Media, Sirius XM's largest
shareholder, in March requested approval to take over the
company's operating licenses, arguing that it had de facto
control of Sirius XM with its large stake and board seats.
Liberty acquired its 40 percent stake in 2009 as part of
deal in which it loaned the satellite radio provider $530
million to help it avoid bankruptcy.
But its strategy to use the FCC to transfer control of
Sirius XM's operating licenses failed.
The FCC said Liberty's application was not "sufficient" to
show it was in control of the company. Liberty was not able to
get passwords, signatures and other information from Sirius XM
to properly submit its application, the FCC said.
Liberty still has other options to gain control of Sirius
XM, whose 22.3 million subscribers make it the largest U.S.
satellite radio provider.
Executives at Liberty have said the company could boost its
stake above 49.9 percent. It already holds five of Sirius XM's
13 board seats.
Sirius XM CEO Mel Karmazin said on a conference call last
week that Sirius XM was not currently "combative" with Liberty.
He said he did not know what Liberty planned to do with its 40
"If the time comes that Liberty's interests are different
than the other 60 percent of shareholders, we will do what we
have to do to protect the interest of our 60 percent of
shareholders," he said.
Sirius XM and Liberty Media did not immediately respond to a
request for comment on Saturday.