Of course, in other circumstances that would suggest buying shares of Liberty as a beneficiary of the acquisition but not in this case. Now here's where Malone's penchant for complicated deals involving stock comes in.
"Liberty Media is creating a new class of stock, Liberty C, which will trade under the symbol LMCC," Cramer explained.
"The company's current shareholders will get 230 million LMCC shares via a 2 for 1 stock dividend. But more important, Liberty will exchange its 460 million of these new C-shares for the rest of Sirius-XM, with one share of Sirius being worth 0.076 shares of Liberty-C. In other words, for every 131 or so shares of Sirius you own, you'll get one share in the new class of Liberty Media's stock."
Essentially, Cramer believes buying Siruis now gets investors in on the ground floor of the new Liberty C shares.
That's desirable because Liberty Media management is forming an independent special committee to review the terms of the deal and then vote on it.
"And I think the independent committee could force Liberty to pay more for Sirius than what they're currently offering," Cramer speculated. "Not that long ago you had SiriusXM trading at $4.18 a share—that's 9% higher than where it is now—and some analysts have been saying it's worth as much #$%$ So I wouldn't be at all surprised if Liberty is forced to pay close to Sirius' recent highs."
Therefore buying Sirius now would make investors the beneficiary of a higher offer. And then after the acquisition is completed the newly formed Liberty C shares allow investors to benefit from the synergies that Cramer believes will follow.
"After the deal closes, all of your Sirius shares will become Liberty Media Class-C shares, and the SiriusXM business will represent around 70% of Liberty Media's operational value. I think Liberty will be able to do a better job of running the satellite radio biz—making it grow faster and generate massive amounts of cash," Cramer said.