Sirius Creditors Ready to Go After CEO

If company files for bankruptcy, they could ask judge to remove him
By Sarah Quinn,  Newser Staff
Posted Feb 16, 2009 10:54 AM CST
Sirius Creditors Ready to Go After CEO
Jamie Foxx hosts his Sirius XM radio show The Foxxhole on Dec. 19, 2008.   (AP Photo/SiriusXM, John Harrington)

Sirius XM Radio's creditors want the company to make a deal with an investor rather than file for bankruptcy, and they're prepared to go after CEO Mel Karmazin's job if things don't go their way, the Wall Street Journal reports. "The board of directors should carefully consider the ramifications" of bankruptcy, a lawyer for the creditor group said. The company's decision is expected today.

The creditors think Karmazin should have refinanced the company's debt—now totaling about $3.25 billion—in July, when Sirius and XM merged. About $175 million of that is due tomorrow. Sirius does have options: Two investors have offered to dump cash into the company in exchange for a stake. "They can't use bankruptcy at creditors' risk as a Hail Mary pass to keep themselves in power," the lawyer said.
(More Sirius XM stories.)

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