Liberty investors still not sold on Sirius play

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In his first public comments on the Liberty Media investment that saved Sirius XM from bankruptcy, Liberty CEO Greg Maffei was bullish — but investors paid no mind.

During his quarterly earnings call, Maffei said Liberty feels there is "relative safety for our capital" in the deal and potential "upside for our shareholders." Nevertheless, Sirius XM shares slid slightly during the regular session Wednesday and another 4% in after-hours trading.

Among the opportunities Maffei outlined is renegotiating expensive content deals that were struck when Sirius and XM competed for listeners.

There might also be synergies between the sat-radio firm and Liberty's DirecTV holding. Bundling offers, for example, could be "opportunities down the road," with free trials of Sirius XM among the possibilities. Mobile video offerings also could provide an opening.

Maffei also said Wednesday that news about the second step of Liberty's deal with Sirius XM, which might get Liberty a stake of about 40%, could be unveiled during the coming weeks.

Liberty owns 54% of DirecTV thanks to stock buybacks, but its voting stake remains locked at 48% under a standstill agreement.

On Wednesday, Liberty reported mixed fourth-quarter results as key businesses saw differing momentum.

Overall, the company posted a quarterly operating loss of $1.3 billion as Starz Entertainment recorded a $1.24 billion goodwill impairment charge because of "current economic conditions and their effect on valuation multiples." For the year-ago period, Liberty reported a $63 million operating profit.

Liberty Entertainment, which includes a stake in DirecTV and Starz Entertainment, recorded a 26% revenue increase to $360 million, and its adjusted operating income before depreciation and amortization rose by 143% to $107 million. The gains were driven by the acquisition of Liberty Sports Group and growth at Starz Entertainment, which benefited from higher rates and subscription units.

Liberty Entertainment is set to be spun off into a separate public company.

Liberty Interactive revenue decreased by 4% and its adjusted OIBDA fell by 21% as the key QVC home-shopping business continues to face economic challenges. (partialdiff)
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