Posted on 02/19/2007 4:02:31 PM PST by kellynla
NEW YORK (Reuters) - Sirius Satellite Radio agreed to buy larger U.S. rival XM Satellite Radio for $4.6 billion in stock on Monday in a deal that gives all subscribers access to entertainers such as Oprah Winfrey and shock-jock Howard Stern.
The transaction, which faces regulatory scrutiny and objections from terrestrial radio companies, gives XM shareholders 4.6 Sirius shares for each XM share held.
The deal has Sirius paying about $4.6 billion in stock for XM, or a 21.7 percent premium to XM's closing share price of $13.98 on Friday, based on shares outstanding in the latest regulatory filings.
Veteran media executive Mel Karmazin, currently Sirius CEO, will lead the new company as CEO, while Gary Parsons, now chairman of XM, will hold the same position in the new company. It said Hugh Panero, XM CEO, will continue in his current role until the merger closes.
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The merger would create a company with about $1.5 billion in 2006 revenue and an enterprise value of $13 billion, including $1.6 billion in net debt.
"This combination is the next logical step in the evolution of audio entertainment," said Karmazin in a statement. He said it will create "unprecedented choice for consumers."
The deal will face tough regulatory scrutiny. The satellite radio licenses prevent one entity from owning them, however Federal Communications Commission Chairman Kevin Martin said last month that its rules are open to change.
"I think it's a close call, but more likely than not I think the Justice Department and the FCC approve it," said Blair Levin, an analyst at Stifel Nicolaus & Co.
(Excerpt) Read more at today.reuters.com ...
I wonder if there will be a reduction in total channels?
I have both - which one are they going to credit me for?
I think we shall see :)
I too have both. I can almost assure you that our fees will go up. No competition tends to do that.
Radio spectrum allocated to two competing service providers now controlled by a monopoly. I don't think this will fly.
I have the Sirius music channels through my Dish at home and an XM in my vehicles. I didn't get the Sirius because of the low-life Howard Stern. But then XM has more than its share of low-lifes, too.
Maybe they can get Laura's show on live instead of running opposite Rush.
The lack of Bolshecrat complaint on the lack of competition is deafening. I was not aware that serius or xm were conservative talk outlets.
Sirus does not carry Foxnews?!
I hope you are wrong....for us in rural areas, sat radio is wonderful.
Too bad....Brit Hume in the afternoon is a must listen for me.
Now Howard Stern can bankrupt the combined company instead of just Sirius.
I think the merger is a good thing and I've seen it coming for over a year now. I don't see any price-gouging as satellite radio has only begun penetrating the market. Satellite radio is where cable TV was in 1973 or about where the compact disc was in 1984.
It is about to EXPLODE.
I've been a Sirius subscriber for two years now and I've never even considered going back to terrestrial. Having over one hundred stations playing music in any genre or sub-genre you are in the mood for commercial free is a bargain at twice the price they charge now.
As for Howard Stern, I haven't given him the time of day. He stays on the opposite end of the radio dial and I don't even hit that station by accident.
I have 18 presets on my car Sirius and I've never had to venture outside them looking for good music. In fact, I almost always have good music on the front six (Outlaw Country, Left of Center (College/Alt Rock), Classic Rewind, 70s, 80s and Hair Nation.
I have three Sirius receivers in the family and one XM receiver. Satellite radio is here to stay.
In fact, unless the iPod incorporates satellite radio in the next generation, it might find itself left behind by the Sirius Stiletto. That is an awesome device and with the push of a button, you can capture any song and listen to it as much as you want until you decide to buy it or not. Once Sirius can work out an iTunes type interface (where you can purchase music), they will be giving Apple a run for their money.
Sirius and XM both have good conservative talk. Sirius, which I have, has Fox Talk, Fox News, ABC Talk, and Patriot.
As for the issue about competition, mentioned by some posts, satellite is competing with iPods, internet, terrestrial radio, you name it. So really, where's the problem?
And if you ever get satellite, you will never go back. I only use two channels of terrestrial radio, one for Rush and one for Laura Ingram.
I keep thinking about buying XM for the baseball games. Now I'm sure the price will go up and people will be complaining about the costs the way they complain about cable rates.
Today was a day that shall live in infamy: No Rush No Laura.
Too bad Reuters got the story wrong, the official press release states that it's an equal merger, Sirius is NOT buying XM.
I love XM. Great technology, great programming, and great prices. Now, when this goes through (mid 2008 at the earliest), it will be all downhill, as Mel Karmazin cannot program to save his life, and he *will* bring advertising to XM, which XM has kept to a minumum so far. I went to Sat Radio because of what people like Mel K. did to terrestrial radio, now he'll destroy it, too. He does not "get" sat. radio.
If I were an XM investor, I would be very concerned about the ridiculous salary that Howard Stern gets, it's wasted and will pull down the budgets until he retires.
When i went to Sat. Radio, I researched it, and XM was clearly the better company. Better radios, more options, and vastly better programming - Sirius plays a very small rotating playlist, where XM plays deeper cuts, and does not have annoying DJs chattering away. This merger upsets me, as it will negatively impact a product I enjoy as is.
And, if Howard Stern is not an additional fee, like it is now, and I am given no choice, thus putting money in his hack pocket, I WILL cancel for that reason, and that reason alone. I despise Howard Stern, and I will not pay a dime towards him.
Prices will also rise, which was expected with both companies.
XM, it was good while we knew you, after this merger, you will be destroyed.
Think of this like Free Republic being taken over and programmed by the LA Times. It will be that bad.
The King of ALL Media rules.
STERN ROCKS
And, if Howard Stern is not an additional fee, like it is now, and I am given no choice, thus putting money in his hack pocket, I WILL cancel for that reason, and that reason alone. I despise Howard Stern, and I will not pay a dime towards him.
oh, don't be jealous.......
How will they do it, the two formats use different equipment. You can't pickup one with the other's equipment as far as I know. I have XM in my car and on DirecTV and love it. I also have Siruis on-line and like a couple of the station that XM doesn't offer(the late 60's- early70's and the all Elvis). As for Stern, I wouldn't walk across the street to, well you know, if he was on fire.
My Sirius radios do carry FoxNews - Channel 131.
Good or Bad?
I don't think the regulators will OK this; this is very similar to the situation with Dish Network and DirecTV. That merger was not approved.
Satellite radio isn't going anywhere. It may change somehow...but it isn't going away. I never listen to the regular radio anymore. Haven't in over a year. Considering XM is up in subscriptions over 500% in the last 3 years...and sirius is up 1200%...and both are still climbing...adding 1-2 mill a year...I think history will see me correct. That would be one big crash. Just because you don't have it or like it doesn't mean you are "the norm." :-)
I started off with Sirius, but I switched to XM when they took too long signing on with Fox News Talk and lost Fox News. I had the XM subscription for a year and I continually lost signal in dense trees etc. that never affected Sirius. Sirius has three satellites, XM has only two and it shows. XM doesn't have dj's but their music programming sucks, in my view.
Baba Booey
In what sense? Expanded programming, share value, long term or short term?
For the life of me I cannot comprehend paying for radio.
It probably has something to do with getting old.
It will.........../s
Good deal because they now have better satellite coverage, more programming possibilities will be available.
Probably will suck.
I had $150 ATT phone when they changed to cingular. Had to buy a new cingular one to keep my work discount on the service with the new cingular network. Now they're ATT again. Talk about identity crisis. Sibyl!
If serius buys xm, which reciever will they use? I've got a couple hundred invested in xm equipment, and had my truck retro'd to use it. Lovely. I hope it doesn't go down... because I bought ahead two years subscription to xm.
Howard Stern is not extra. It comes with the basic Sirius subscription.
Yes, I agree. And with the Dems talking about reviving the Fairness Doctrine, thank goodness for private broadcasting. The FCC needs to keep its cotton-picking hands off of it as well.
They'll simply broadcast the same streams on both XM's and Sirius's satellites so both companies' receivers will pickup the channels. The new receivers produced will likely be able to use both satellites' streams, using whatever one is currently the greatest signal strength. There was rumors floating around about the Sirius and XM's receivers were required by the FCC to be operable on either network, but I'm pretty sure thats false.
As for Stern, don't care at all, its not worth my time to even argue about him. I have yet to listen to any channel higher than 63, and 99% of the time, my Sirius radio is tuned to either Outlaw Country, Octane, or Classic Rewind.
Playboy Radio is free to anyone that has Sirius also, just have to enable it.
I don't think so. For people who drive cross country regularly, it's pretty much necessary.
I have the reverse - XM on Direct TV and Sirius in my vehicles.
I never understood why anyone would pay for radio in the first place.
It always sounded like a 'stock-scam' to me, like the overblown dot-coms of the '90s ............ FRegards
Sirius has Fox News too. I am a Sirius subscriber because the music channels are better.
The merger better not take away my Hair Nation!!
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