By Relmor Demitrius
If everyone reading this doesn't know what the Borg is, it is a Star Trek reference to an alien race that is an enemy to mankind. They are half robots, half organic lifeform, that only cares about the collective, not the individual. In covering Sirius XM (NASDAQ:SIRI) for over 6 years now, I have decided this is the most appropriate way to describe what John Malone is and what he stands for. The news of course is that Liberty wants to absorb Sirius XM into their portfolio, further capitalizing on leverage and cash for the parent company. A great move for Liberty stockholders. I'm sure there are other reasons as well, (tax reasons, etc.). So why do I label John Malone and Liberty Media the "borg". That is simple. They are an uncaring conglomerate out to assimilate you into their collective. And just like the borg in Start Trek, it is whether you like it or not.
The offer to Sirius XM stockholders for conversion to an ETF is a literal joke. I don't really want to focus too much here on the offer, as it doesn't really warrant too much discussion or analyzing. I could explain to the average high schooler or even 5th grader in 5 minutes why this is a bad deal. The average adult wouldn't need five seconds. So why the offer? I think it is two fold.
1. You never know. I think if the Borg can convince enough institutional holders that he can get them either a run on the SIRI stock or the new C shares, they will vote for it and get out much higher than here. You might get lucky and it passes.
2. Start the negotiations at a low point. If this is the beginning of a long negotiating process, then you might as well low ball your first offer. 2 problems with that. You are undervaluing your own company, hence it's a extreme conflict of interest. A majority owner would only evaluate his own holding if he were trying to acquire it all or to sell it. So this isn't a bluff. Its a hard take over attempt, complete and utter. I have heard many investors saying this is a bluff. He's trying to support the price cause it will be a bad 4th quarter. Hog wash. Utter nonsense. You don't low ball your own shares if you aren't serious. The Borg here is very serious. This is also a nice way to gauge shareholder reaction too. I have yet to find one shareholder who likes the deal. Which is normal. Be like trying to find one person who hates sunshine or the laughter of a child. Sure you can find some, but they are weird, and not worth talking too and probably someone who should be avoided really at all costs.
There is even a Borg apologizer on this website who said he wouldn't want non voting C shares. And this guy is literally in love with Malone. So even Malone lovers hate the deal. So why offer it? Cause the Borg has begun the assimulation process and will not stop until completed.
All Sirius XM is to the Borg is another component in a means to a larger end. Based on Liberty's activities its chock full of risk and very unorganized. It appears he is trying to be a player, when he isn't. In fact, Liberty never could afford to buy the amount they own right now even. Even 2 years ago. Would have been impossible. Now the small guy is telling the big guy what to do. Give me your money, your future, and your lifeforce, and in return I will give you a back seat ride with no view of the screen. You are now gum on the bottom of the Borg's shoe. Vote this down wholeheartedly and never look bad. No reason to discuss or breakdown the deal, because the Borg's first play is a laser shot across Sirius XM's bough, and they never asked for a parlay. When you declare war on someone, no reason to discuss anything.