Are things looking up for satellite radio provider Sirius XM Radio (SIRI) after Liberty Media (LMCA) made more moves to takeover the company? While this may be great for Liberty Media investors, it could spell doom for those of Sirius.

The latest moves, made in mid-May, would specifically increase Liberty Media’s stake in Sirius XM to 45.2%. It announced at the time of the release of its second-quarter fiscal 2012 earnings that it had entered into a forward purchase contract for 302 million shares of Sirius XM with a forward price of $2.15 per share. The cost is $650 million. The transaction is set to close in the third quarter of fiscal 2012.

To get an idea of the impact, if any, the $2.15 a share price may have, let’s look at Sirius XM’s trading price at the time of Liberty Media’s latest move. At that time, in mid-May, Sirius XM was trading at $2. That was within its 52-week trading range of $1.27 and $2.44. It should also be noted that the $2 reflected a 5% decrease for that day’s session. So, the news of Liberty Media’s intent did not bode well at all for Sirius XM, and I think that directly reflects investor sentiment that it is time to bail on Sirius XM.

I have heard naysayers say that Sirius XM shareholders should be leery about Liberty Media’s moves to increase the number of shares it owns in Sirius XM. The concern is that Liberty Media seems to be saying that Sirius XM is not worth any more than $2.15 a share.To continue reading, click here.