Shock jock Howard Stern announced on his radio show Thursday that he will stay at Sirius XM (NASDAQ:SIRI), sparking an 8% rally in the satellite radio company’s share price.
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Stern, 56, said he will remain with Sirius for another five years. He also told his listeners he never had “heavy discussions” about moving to Apple’s (NASDAQ:AAPL) iTunes.
It’s not clear if he took a pay cut from his current contract that was worth $500 million over five years, but many analysts predicted he would have to take less money because his options for a new landing spot were somewhat limited.
"On my first day in satellite radio SIRIUS had approximately 600,000 subscribers. Today, the two companies have 20 million; and, in my view, we have just scratched the surface of how many people will get on board," Stern said in a statement.
Stern’s original contract with Sirius was signed back in 2005 before the company merged with then-rival XM.
Under the terms of the new contract, Sirius said it will now have the right to transmit Stern's exclusive programming to mobile devices.
"Howard is a great talent and we are thrilled that he will continue to provoke, engage and entertain on SIRIUS XM. Our agreement is good news on all fronts – it is good for SIRIUS XM subscribers and good for SIRIUS XM stockholders," Sirius CEO Mel Karmazin said in a statement.
Stern said his show’s cast and crew haven’t resigned with Sirius yet, but that he expects most of them will.
Sirius’s shareholders cheered the announcement, bidding the company’s stock up 8% to $1.42 ahead of Thursday’s open. While well off its historic highs of more than $60 a share, Sirius has surged more than 120% year-to-date.