The SiriusXM board of directors is being sued by investors who believe the board isn’t doing its best to ward off a takeover by Liberty Media.
According to the suit filed in a Delaware Court, investors claim Sirius failed to block Liberty’s efforts to buy enough stock to gain control of the satcaster, Bloomberg reports.
Liberty bailed out SiriusXM in 2009 with a $530 million loan when the satellite radio company was facing a debt crunch. Part of that deal included facilities for converting some of the loan into equity (shares). Subsequently, Liberty has converted and purchased enough shares so that it now owns some 48% of the company.
Liberty Chairman John Malone is on the SiriusXM board and is wrongly preventing fellow board directors from “adopting anti-takeover provisions even if doing so would be in the bests interests” of the company, states the City of Miami Police Relief and Pension Fund in the complaint.
The loan agreement between SiriusXM and Liberty barred Malone from a takeover attempt for three years, according to the investors, who claim Malone is trying to gain control of the company without paying a premium.