LOS ANGELES -- Debt-ridden Sirius XM Radio Inc. is seeking an investment from Liberty Media Corp., which controls Los Angeles-based DirecTV, to fend off an unsolicited takeover bid from satellite entrepreneur Charles Ergen, it was reported Thursday.
The talks have set the stage for a battle between the leading U.S. satellite television providers -- DirecTV and Ergen's Dish Network Corp. -- for control of the country's only satellite radio operator, The Wall Street Journal reported.
Liberty, controlled by billionaire John Malone, emerged as a potential white knight for Sirius after Ergen made an unsolicited offer to take control of Sirius late last year, the Journal reported.
Though the talks between Sirius and Liberty are advanced, a deal remains far from certain, a person familiar with the issue told the newspaper.
Ergen quietly began amassing Sirius debt in the fall. He is now using that debt, including about $175 million in bonds that mature on Feb. 17, as leverage to try to force Sirius into a deal, according to the Journal.
Sirius, which carries a total debt load of about $3.25 billion, is nearly out of cash and likely will be forced into bankruptcy proceedings or a deal with Ergen if it can't secure funds to repay its obligations on Tuesday.