CEO Mel Karmazin may have pulled Sirius XM away from the brink of a bankruptcy filing, but dissident shareholder Michael Hartleib isn’t impressed. He says shareholders have been sold out by Karmazin and the board of directors in the deal with Liberty Media and John Malone.
Hartleib last week told RBR/TVBR it was “outrageous” that Sirius XM got a waiver from Nasdaq and won’t have to put the deal with Malone to a shareholders vote. Now he’s expounded on that in a posting on his SaveSirius.org website.
“The recent Liberty Media deal is better than an already filed bankruptcy plan, but not by much. Mel just gave away forty percent of our company for pennies on the dollar. This deal will be nearly catastrophic to common shareholders as it just postpones the inevitable and is extremely dilutive. Mr. Karmazin and this Board of Directors must be estopped from further self dealing and removed as they are not capable of making a disinterested business judgment,” Hartleib wrote. And that was before he really let fly with accusations against the company’s management and directors.
Some of Hartleib’s accusations involve serious wrongdoing. He asked himself the rhetorical question, “I wonder why they don’t sue me for liable?” Then he answered that the truth is an absolute defense.
“We the true owners of this company have been sold out by Mr. Karmazin and his management team as they have put their self interest ahead of the shareholders in which they owe a fiduciary duty,” Hartleib complained.
What’s next? Well, Hartleib is preparing yet another lawsuit. He’s also urging fellow shareholders to complain to Nasdaq, the SEC, Congress and the press.
RBR/TVBR observation: This year’s shareholders meeting has already taken place and Nasdaq has given the company a waiver so no shareholder vote will be required for the Liberty Media deal. That leaves Hartleib without much of a forum this year for shareholders to challenge the board’s actions. We do, however, expect him to head to the courts yet again.