Sirius XM and Liberty Media Play Nice

There will be an interesting speaker at Liberty Media's (Nasdaq: LMCA) annual investor meeting next week.

Mel Karmazin -- Sirius XM Radio's (Nasdaq: SIRI) opinionated CEO -- will be a presenter at the Oct. 10 powwow.

The move makes sense at first. Liberty Media is nearing majority control of the satellite radio provider. It's simply a matter of time before John Malone's eclectic media conglomerate bumps its stake in the satellite radio provider above 50%, a move that will likely result in a shareholder spinoff. If Liberty Media wants to get its investors excited about the appendage, having Karmazin sell them on Sirius XM's potential is smart. If Karmazin doesn't want to see Sirius XM's stock take a hit after the spinoff, it's in his best interest to encourage Liberty Media investors to hold on to their eventual shares.

Karmazin speaking at the meeting makes sense for both sides. However, weren't the two factions in a war of words just last month?

Karmazin started things up recently.

"My instincts today are that Liberty does not need me at the company," he said at an investor conference three weeks ago, pointing out that he has historically been expensive to keep.

Karmazin's current deal as Sirius XM's CEO ends this year, and there has been no public chatter as to where things stand in terms of negotiating an extension.

"It's very clear to me that if I were Liberty, I would sit there and say, 'I'm not sure we need Mel.'"

Liberty Media CEO Greg Maffei seemed to agree a week later.

"The business will not fail without Mel," Maffei said at a different investor conference. "Graves are full of replaceable people."

Obviously they didn't mean to agree. Karmazin was merely either negotiating in public or setting the stage to leave the company on his terms. Maffei was simply calling his bluff.

However, Karmazin wouldn't be speaking before Liberty Media shareholders next Wednesday if things were still volatile. Karmazin isn't a loose cannon, but he is a colorful media guy. He doesn't mince words. Even if it's in the best interests of both companies for Karmazin to play nice -- sustaining the recent gains made in Sirius XM's stock -- a deal seems to be on the horizon.

Liberty Media wouldn't be showing off Karmazin as the face of Sirius XM to its investors just three months before replacing him. A contract extension is probably in the works, and that's good news for both parties.

Running of the bulls
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