Sirius Satellite Radio skipped a scheduled interest payment on its debt last month, the company said Friday. The payment of $720,000 was due on Sept. 30, but the company decided to delay payment while it negotiates new financing, Sirius said in a statement. The company has a one-month grace period and will not technically go into default until Oct. 31. The interest is on $16 million worth of convertible notes that are due in 2009.
Sirius has about $250 million cash on hand, the company said. However, the satellite radio company has $569 million in long-term debt andinvestors in mid-August that it might have to file for bankruptcy protection if it doesn't raise $300 million by mid-2003. Unlike competitor XM Satellite Radio, which claims 200,000 customers, Sirius has shown disappointing adoption rates. The company, which launched its paid radio service in July, has less than 10,000 subscribers.