Below The Beltway

It looks like a last minute loan from the owner of DirecTv has prevented what seemed to be an inevitable Chapter 11 filing:

Liberty Media has agreed to loan Sirius XM Radio $530 million to help save the satellite radio provider from bankruptcy.

Liberty Media, which owns DirecTV, and Sirius said in a news release that the loan will go to paying $175 million in debt that comes due for Sirius today. The remainder of funds will be used to pay other debts coming due in May and at the end of the year, and for general working capital to run the satellite radio business.

In exchange, Liberty will receive 40 percent of Sirius’s common stock and get seats on Sirius’s board of directors. Liberty Chairman John Malone and chief executive Greg Maffei are expected to take those seats. Liberty Media, based in Englewood, Colo., owns several television media entities including QVC and Discovery.

“We are excited to be investing in SIRIUS XM. We have been impressed with the company, its operations and management team,” Maffei said in a release. “SIRIUS XM’s ability to grow subscribers and revenue in a difficult financial and auto market is indicative of how listeners view this as a ‘must have’ service.”

The last-minute deal with Liberty will help Sirius pay off some of its heavy debt burden while also retaining management control. Sirius had said that if it could not find an investor, it would be forced to file for bankruptcy. The company has another $350 million in debt due in May and a total debt of $3.2 billion.

And, one would expect, we’ll see some type of integration between the two products.