NEW YORK (AP) -- Sirius XM Radio said Wednesday that it will use a new $1.25 billion credit line for working capital as well as buybacks, dividends and to finance acquisitions.
"SiriusXM's credit quality has rapidly improved and we are pleased that the bank market has recognized that fact by oversubscribing the deal, allowing us to upsize the facility to $1.25 billion," said Chief Financial Officer David Frear in a statement. The credit line is secured by all the assets of the company and its subsidiaries.
The satellite radio company said the five-year credit line will help it drive down average borrowing costs and more tightly manage cash and debt balances, and provides a ready source of cash for acquisitions.
In November Sirius XM Radio Inc. reported that its third-quarter net income declined, hurt by costs to pay down debt early. Sirius XM Radio Inc. is the world's largest radio broadcaster measured by revenue and has 23.4 million subscribers.
The New York company's stock closed up a penny at $2.77.
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