Satcaster stock fall looks Sirius
Loss poses threat of bankruptcy
Gotham-based Sirius, one of two companies vying for customers in the nascent satellite radio market, had a little more than $300 million in cash and equivalents on its books at the end of the quarter. It said in a regulatory filing that it would need a further $300 million to make it through the end of next year.
Satcaster said it is in talks with representatives from several potential equity investors, including private-equity firms Apollo Management and the Blackstone Group, and has hired investment house UBS Warburg to help cut a deal.
Sirius posted a loss of $113 million in the three months ended June 30 -- deeper than both Wall Street predictions and a $62 million loss in the same quarter a year ago. The company launched its nationwide service, which offers 150 channels of digital music, talk and sports programming for $12.95 a month, one day after the current quarter ended.
Sirius said it had just 6,500 paying subscribers as of Sunday. Satcaster has said it hopes to sign up as many as 200,000 subscribers by the end of this year. Chief rival XM Satellite Radio, which launched its service late last year, has 137,000 subscribers.
Sirius' shares have tumbled from a high of more than $13 in January to Tuesday's close at $1.35 amid uncertainty about the potential of satellite radio in general, and Sirius' ability to compete with XM in particular.
