He says Liberty will replace him as CEO when it takes over
Shares of Sirius XM Satellite Radio fell sharply in an up market Wednesday after CEO Mel Karmazin predicted he’d be replaced when Liberty Media eventually takes over the company.
The stock plunged as much as 4% to $2.40.
“My instincts today are that Liberty does not need me at the company,” the highly regarded exec told investors at the Bank of America Merrill Lynch Media Conference in Beverly Hills. “I have historically been expensive. It’s very clear to me that if I were Liberty, I would sit there and say, ‘I’m not sure we need Mel.'”
Liberty has been rapidly building up its stake in Sirius, looking to reach the 50% level it needs for control. It’s up to about 48%. The process has created tension between the two companies.
Liberty execs have often complimented Karmazin, whose contract expires at the end of the year. In June, Liberty CEO Greg Maffei said he liked him and wanted him as chief executive.
Liberty is most likely planning to spin off Sirius into a new public company, distributing stock to Liberty shareholders.
Malone got into Sirius when it was financially struggling in 2009 and he loaned it $530 million. The agreement, which stipulated that Malone couldn’t seek control of the satcaster for three years, expired this summer.