As if hassles with it's debt load, share price, and dependency upon the depressed auto sector wasn't enough, now Sirius is having distribution woes.
Directed Electronics said it will exit the satellite radio market, citing softening sales of aftermarket satellite radio products.
Directed will stop acting as Sirius’ exclusive retail distributor on Jan. 31, 2009, the company announced
late yesterday. Citing Sirius XM’s high debt of more than $1 billion, and the unfavorable credit markets, Directed said the relationship with Sirius no longer provides a favorable “risk-reward tradeoff.” It offers “a relatively small contribution [to sales] vs. the potential risk of a catastrophic situation for us if they can’t refinance,” said Jim Minarik, president and CEO of Directed’s parent, DEI Holdings, on a conference call with analysts.
For Sirius, when it rains, it pours, apparently.
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