At Sirius Radio, a Dogged Resistance to Liberty Media

Sirius XM Radio Chief Executive Mel Karmazin is so single-minded about the satellite radio broadcaster that on sunny days he walks the dozen blocks from his New York apartment to the office, listening to Sirius programs on headphones. Not that he's only tuned in to the programs. Karmazin is focused on "the numbers," said a former Sirius board member. He is "totally preoccupied with the valuation of the company." That preoccupation has intensified in the past few months, as Karmazin has publicly battled with Sirius's biggest shareholder, Liberty Media over its efforts to take control of the company.

On June 11, for the second time, Sirius opposed a petition from Liberty to the Federal Communications Commission seeking approval to exercise effective control with its stake of less than 50%. Sirius contends that Liberty still hadn't taken concrete steps to get control -- even though that was an FCC stipulation. Sirius noted to the FCC that while Liberty now has a stake of 46.2%, it hasn't, for instance, "proposed specific nominees" for the board. At the heart of the battle appears to be Karmazin's conviction that Liberty shouldn't get control of Sirius without paying for it. Liberty got its initial 40% stake for virtually nothing -- a $12,500 nominal payment included as part of the terms Liberty exacted for rescuing Sirius from financial distress in early 2009 with a package of loans. That stake is now valued at about $5 billion, while the loans were quickly repaid.