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Billionaire John Malone's push to take over Sirius (SIRI) XM Radio Inc. is setting up a potential clash with Sirius Chief Executive Officer Mel Karmazin, who stands to lose power under the deal.

Malone's Liberty Media Corp. (LMCA) plans to assert control of the largest U.S. satellite radio provider after receiving approval from the Federal Communications Commission, the Englewood, Colorado-based company said yesterday in a filing. The move would put Karmazin, who helped turn around Sirius after years of losses, under the command of Malone and Liberty CEO Greg Maffei.

"I could see a situation where there could be conflicting personalities," Brett Harriss, an analyst at Gabelli & Co. in Rye, New York, said in an interview. "These are two high- powered guys in Mel and John."

Patrick Reilly, a Sirius spokesman, declined to comment. Courtnee Ulrich, a Liberty spokeswoman, didn't respond to a telephone call and e-mail.

Liberty, the holder of interests in businesses ranging from cable programmer Starz LLC to the Atlanta Braves baseball team, has asked the FCC to reconsider the agency's May 4 dismissal of its application for permission to take control of Sirius, according to a filing with the Securities and Exchange Commission.

Spinoff Plan?

Liberty's move has fueled speculation that Malone wants to spin off his stake in New York-based Sirius. Liberty will probably execute a so-called Reverse Morris Trust, which involves splitting off its Sirius stake as a separate entity and giving its stockholders the option to hold or sell their Sirius shares, according to James Ratcliffe, an analyst at Barclays Capital Inc. in New York.

To execute the spinoff, Liberty must have Sirius's board approval. Sirius is in talks with Liberty about the company's ownership interest, according to a separate filing by Sirius. It said Sirius doesn't expect to disclose developments in the discussions.

The New York Post reported today that Maffei may want to run the satellite broadcaster directly, leading Karmazin to leave after the Sirius CEO's contract expires on Dec. 31. Maffei is tired of being a portfolio manager for a broad swath companies, the Post reported, citing a person familiar with the matter.

Sirius shares declined 1.3 percent to $1.87 at 10:28 a.m. in New York. The stock has slid 17 percent since Liberty filed its application with the FCC on March 20. Liberty shares, up 7.2 percent this year, fell 1.3 percent to $83.69.

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Malone's Push for Sirius Control Sets Up Karmazin Clash