XM & SIRIUS MERGE

[DRTYFN]

It's a done deal. Now it just needs regulatory approval.

Sirius Radio to merge with XM
NEW YORK (Reuters) - The two main U.S. satellite radio providers, Sirius Satellite Radio and XM Satellite Radio on Monday said they would merge in a stock-for-stock deal, a move that has been long expected in the young industry.

XM and Sirius said they would combine to create a company with an enterprise value of $13 billion, including $1.6 billion in net debt.

Under the terms of the deal, XM stockholders will get 4.6 shares in Sirius.

Veteran media executive Mel Karmazin, currently Sirius CEO, will be CEO of the combined company, and Gary Parsons, now chairman of XM, will hold the same position in the new company. The deal will need regulatory approval.
http://today.reuters.com/news/articl...src=rss&rpc=23

Satellite Radio Rivals XM and Sirius Agree to Merge, but Regulatory Hurdles Remain
NEW YORK (AP) -- XM Satellite Radio Holdings Inc. and Sirius Satellite Radio Inc. have agreed to merge, the two companies said Monday.
The deal would consolidate the only two companies in the emerging business of subscription-only satellite radio, and is sure to face tough scrutiny from federal regulators. Investors and analysts have been speculating about a deal for months.

The two companies said in a statement that Mel Karmazin, the CEO of Sirius, would become chief executive of the new company while Gary Parsons, the chairman of XM, would remain in that role. XM's CEO Hugh Panero will remain to oversee closing the of the deal, they said.

The deal would face significant regulatory hurdles in Washington, including a Federal Communications Commission rule that clearly states that one satellite radio provider cannot buy the other one. However, that rule could be waived.

A combination would also have to meet antitrust approval from the Department of Justice. The companies are expected to argue that they compete not only with each other but also with a growing base of digital audio sources such as iPods, mobile phones, and non-satellite digital radio.

XM and Sirius have both posted significant financial losses as they built up their programming lineups and recruited subscribers. Both stocks declined more than 40 percent last year on concerns about their continued growth in subscribers and softness in the retail market, but investors have held out hopes that a merger could bring costs down significantly.

Shareholders of XM and Sirius would each own approximately 50 percent of the combined company. XM shareholders would receive 4.6 shares of Sirius stock for each share of XM they own.

That would value XM shares at $17.02 each, based on Friday's closing prices, representing a premium of 22 percent from XM's closing value of $13.98 Friday. Markets were closed Monday for the Presidents' Day holiday.

The companies didn't say what the new company would be called, though they described it as a merger of equals. The new company's board will have 12 members, including Parsons, Karmazin, four independent directors named by each company, and one representative each from General Motors Corp. and Honda Motor Co.

News of a possible merger was reported earlier Monday by the New York Post.

On Friday, a Bear Stearns analyst said in a research note that a merger would have a good chance of overcoming regulatory obstacles.

Other analysts remain less sure. Sanford C. Bernstein analyst Craig Moffett said he gives the deal a "50-50" chance of passing regulatory muster.

Moffett said the deal could have a particularly tough time getting through the FCC, and is likely to opposed by the National Association of Broadcasters, a lobbying group that includes radio broadcasters. Moffett said it was "anyone's guess" as to whether the FCC would change its rule barring a consolidation of the two satellite radio companies.
http://biz.yahoo.com/ap/070219/xm_ra...rius.html?.v=8

[KenP]

All of those that went out and bought stand-alone head units to pick up the other company =

[BlueHUMMERH2]

Originally Posted by KenP

All of those that went out and bought stand-alone head units to pick up the other company =

Yeah, like my in dash unit... At least when I move to an H1 someday, I won't have to think too hard about what service to get...

[K9sH3]

Its all good with me, I don't listen to either.

[ssgharkness020147]

I'll I can say is, ****, ****, ****. I HATE XM, if this goes through the Surius programming better stay the same.

[BlueHUMMERH2]

Originally Posted by ssgharkness020147

I'll I can say is, ****, ****, ****. I HATE XM, if this goes through the Surius programming better stay the same.

I feel the same way kinda. I hope that they take the already great SIRIUS programming, and just add some of the other stations XM has that SIRIUS doesn't. That would be cool with me.

[BuzzH3]

http://xmradio.mediaroom.com/index.p...ases&item=1423

Sorry, if this is a repost.

[marin8703]

its about itme, although they might have some problems with the feds. And it turns out that Sirius is buying XM. Donno why the stronger company would sell to the weaker, but thats business.

[f5fstop]

Originally Posted by marin8703

its about itme, although they might have some problems with the feds. And it turns out that Sirius is buying XM. Donno why the stronger company would sell to the weaker, but thats business.

What I just read, stated Sirius was to give 4.56 shares to every XM share.

[BlueHUMMERH2]

To create a 50/50 split. So that could mean Sirius has 4.56x more shares I suppose.

Kinda sucks though. I like my Sirius. I just hope the don't start editing more stations now.

[Sewie]

Originally Posted by BlueHUMMERH2

To create a 50/50 split. So that could mean Sirius has 4.56x more shares I suppose.

No it means that XM's stock is worth more.

As of this morning:

Sirius = $4/share
XM = $15/share

[RubHer Yellow Ducky]

Hasn't happened yet and Uncle Sam may not allow it

RYD

[wpage]

Look @ AT&T or at&t

Interesting, will take a bit of work to avoid anti-trust concerns.

[Bully13]

They are both crap

[Icyelle]

http://www.voipmonitor.net/2007/02/1...IUS+Merge.aspx

I wonder how this will affect subscribers?

[Vettster]

Originally Posted by Icyelle

http://www.voipmonitor.net/2007/02/1...IUS+Merge.aspx

I wonder how this will affect subscribers?

I wonder how many subscriber there are between the two companies?
Lets see.....


XM: 132 subscribers
Sirius: 73 subscribers
Total: 205

You do the math.

[SnakeH2]

Originally Posted by Icyelle

http://www.voipmonitor.net/2007/02/1...IUS+Merge.aspx

I wonder how this will affect subscribers?

Which ones? The small percent that actually pay???

[DRTYFN]

The merger just got the okay from the Department of Justice.
http://biz.yahoo.com/rb/080324/xm_si...ust.html?.v=12

Satellite radio merger gets antitrust OK
WASHINGTON (Reuters) - Sirius Satellite Radio's (NasdaqGS:SIRI - News) $4.59 billion purchase of rival XM Satellite Radio (NasdaqGS:XMSR - News) was given antitrust clearance on Monday as the Justice Department concluded consumers have many alternatives, including mobile phones and personal audio players.

Investors sent shares of both companies sharply higher even though the Federal Communications Commission must still approve the combination of the only two U.S. providers of satellite radio, a deal first announced in February 2007.

In a victory for Sirius Chief Executive Mel Karmazin, who lobbied hard for the deal, the Justice Department agreed the satellite radio companies face stiff competition from traditional AM/FM radio, high-definition radio, MP3 players and programming delivered by mobile phones.

"Competition in the marketplace generally protects consumers and I have no reason to believe that this won't happen here," Justice Department antitrust chief, Thomas Barnett, told a conference call with reporters.

The traditional radio industry, consumer groups and some U.S. lawmakers had criticized the deal, which would bring entertainers such as talk show host Oprah Winfrey and shock-jock Howard Stern under one roof.

The National Association of Broadcasters, which fought against the deal, said the Justice Department had granted XM and Sirius a "monopoly" and called the decision "breathtaking."

Sirius and XM, which are losing money, each currently charge subscribers about $13 a month for more than 100 channels of news, music, talk and sports.

New York-based Sirius' programming includes lifestyle guru Martha Stewart and NFL Football while Washington, D.C.-based XM is home to Bob Dylan's radio show and Major League Baseball.

The Justice Department said the combination would lead to "substantial" cost saving steps such as consolidating the line of radios they offer. It said those savings would "most likely to be passed on to consumers in the form of lower prices."

XM stock ended Monday up 15.5 percent to $13.79, while Sirius closed up 8.6 percent to $3.15, both on Nasdaq. At that price for Sirius' stock, the deal, in which 4.6 shares of Sirius are to be exchanged for each XM share outstanding, is worth $4.59 billion.

AWAITING FCC DECISION

The antitrust decision shifts the spotlight to the FCC, which must determine whether the XM-Sirius is in the public interest, and whether to enforce its 1997 order barring either satellite radio company from acquiring the other.

A source at the FCC said Chairman Kevin Martin has yet to make a proposal either approving or opposing the XM-Sirius combination, but has asked the agency's staff to draft documents for different possible outcomes.

This source said the FCC could be strongly influenced by the Justice Department decision. "I think it would be hard to go in the complete opposite direction," said the source.

Analysts at Stifel Nicolaus said the FCC could impose conditions, such as requiring the companies to adhere to promises Karmazin made to Congress last year.

Karmazin promised lawmakers that a combined company would offer packages of channels that customers could pick on an "a la carte" basis, and that customers would be able to block adult channels and get a refund for those channels.

In addition, Stifel Nicolaus said, the FCC also may require Sirius and XM to promise that all existing satellite radios will continue to work after the companies are combined.

David Bank, an analyst with RBC Capital Markets, was optimistic about FCC approval. "Now it's past DOJ, and we feel pretty optimistic it will get through the FCC," he said.

The Justice Department's decision provoked immediate criticism from a key lawmaker in Congress, Senate antitrust subcommittee chairman Sen. Herb Kohl, a Wisconsin Democrat.

Kohl took the department to task for "failing to oppose numerous mergers which reduced competition in key industries, resulting in the Justice Department not bringing a single contested merger case in nearly four years."

"We urge that the FCC find the merger contrary to the public interest and exercise its authority to block it," Kohl said in a statement.

Sirius and XM said in a brief statement that they had received antitrust clearance and that their deal was still subject to FCC approval.

[wpage]

Expensive radio. About to get more pricey!