XM/Sirius radio merger announced (linked from General Chat)

[edkwon]

I know the original posts existed in the General Chat forum, please leave this link up so ppl in the Interior/Audio forum who dont read General Chat are aware of this

 

http://www.legacygt.com/forums/showthread.php?t=54976&highlight=sirius

 

SIRIUS, XM SET TO CONFIRM MERGER PLAN TODAY

 

February 19, 2007 -- Satellite radio operators Sirius and XM are expected to announce their long-awaited merger today, according to a source familiar with the deal.

 

The two sides were locked in negotiations over the weekend trying to hammer out a final agreement with an eye toward going public with the merger today in Washington, D.C., where XM is based, this source said.

 

Talks were still going on at press time and the deal could fall apart at any time. With antitrust issues of paramount importance, this source said lawyers for both companies were working overtime to fine-tune the language of the agreement and frame the discussion around the deal itself and not regulatory concerns.

 

The transaction is expected to be structured as a merger of equals, but given Sirius' higher enterprise value, shareholders in the Mel Karmazin-led firm will likely come away with a larger percentage of a combined company.

 

According to the source, XM Chairman Gary Parsons will retain that title in the combined entity, with Karmazin likely taking the CEO role. It is unclear what role, if any, XM CEO Hugh Panero will play.

 

Combining Sirius and XM would result in a single satellite radio operator with more than 12 million total subscribers. A deal would also marry Sirius content, such as Howard Stern, Frank Sinatra and Nascar with XM's Oprah Winfrey, Bob Dylan and Major League Baseball.

 

More important, analysts widely predict that a deal would also save the two companies nearly $7 billion annually.

 

Karmazin and Parsons have been dropping hints since last summer about a possible tie-up, believing that competition from terrestrial radio, online radio and mobile music devices such as iPods have not only expanded the marketplace but also lowered the regulatory hurdles to a deal.

 

In a note on Friday, Bear Stearns analyst Robert Peck speculated that Sirius and XM needed to move quickly before their window of opportunity closed.

 

Gaining regulatory approval "could take up to 15 months; hence, we think any proposed deal needs to be announced by the end of March to close by mid-2008," Peck wrote.

 

On Friday, XM shares hit their lowest point since early November while Sirius shares were approaching 52-week lows. Shares in both companies did trade on heavy volume and ended the session higher, with Sirius gaining 10 cents to close at $3.70 and XM jumping a dollar to $13.98.

[zmarko]

It's official by the way. http://www.allaccess.com

[robinlsb]

Let us hope it doesn't pass the smell test at the FCC!!!

[snoman]

Let us hope it doesn't pass the smell test at the FCC!!!

 

+1. This is terrible news for consumers.

[AWD GT]

This is funny because I'm big on Sirius, and they hated xm claimed how they were better and now they merge. Sounded like something that would never happen. What do you think this means for the world of new equipment? I have to upgrade my receiver and wonder if I should wait.

[zmarko]

I have to upgrade my receiver and wonder if I should wait.

Definitely wait. Unless you can get a receiver free.

[Magic]

bad for Consumers, but good for people (me) who own stock in both companies. Especially those that got in on the ground floor for less than $1 a share....

[AWD GT]

Kudos to majic. I do have a free receiver and i was thinking of putting in the new thin sporster where that sunglasses holder is in the dash but i have to measure it out to see if it fits.