Sirius CEO Mel Karmazin May Be Kicked Out If Company Goes Bankrupt

Posted Feb 16, 2009

Sirius XM Radio Inc.(NASDAQ:SIRI) may be kicked out of the CEO position of the company if they decide to file for bankruptcy protection according to The Wall Street Journal.  The Journal was notified of this possibility by a group of creditors involved with Sirius.

“Creditors will act quickly and definitively if they perceive that management is acting in their own interest and not in the best interest of the estate,” Edward Weisfelner, a partner with Brown Rudnick, the law firm representing the creditor group, told the newspaper. “The board of directors should carefully consider the ramifications.”  The company met over the weekend to determine which plan is most suitable.

Creditors would petition the court to have Sirius’ management team removed and be replaced with independent trustees.  Sirius was rumored to be seeking investment from Liberty Media.  Liberty Controls DirecTV.  If Sirius goes bankrupt, then it would be the second largest Chapter 11 this year as they have about $5 billion in assets.