Miami City Police Relief and Pension Fund on Tuesday sued to stop a potential takeover of Sirius XM Radio Inc. by Liberty Media Corp.
The defined contribution plan for active Miami police officers filed both a suit seeking class-action status and motion for a temporary restraining order on behalf of investors, contending that Sirius directors failed to erect anti-takeover defenses for the largest U.S. satellite broadcaster despite efforts by Liberty Media Chairman John C. Malone to gain control of the company. Because Liberty owns a 48% stake of Sirius, Mr. Malone is on the radio provider’s board.
Mr. Malone and other Liberty Media executives serving on Sirius’s board are improperly barring fellow directors from “adopting anti-takeover provisions even if doing so would be in the best interests” of the company, the Miami pension fund said in the complaint, filed in Delaware Chancery Court in Wilmington.
Liberty Media, based in Englewood, Colo., said earlier this month that it intends to increase its holding in Sirius to more than 50% to take control of the firm and its airwave licenses.
Kelly Sullivan, a spokeswoman for Sirius, didn’t immediately respond to an e-mail seeking comment on the suit. Courtnee Ulrich, a Liberty spokeswoman, also didn’t respond to an e-mail seeking comment.
Liberty Media officials said in an Aug. 17 filing with the Federal Communications Commission that by increasing its stake, the company is poised to take control of Sirius within 60 days of receiving regulators’ approval of airwave-license transfers.
Liberty Media is a holding company with a range of investments, including stakes in the cable TV programmer Starz and Major League Baseball’s Atlanta Braves. Mr. Malone said last month he intends to spin off Sirius as a publicly traded company once he gains a controlling stake.