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SIRIUS and XM to Combine in $13 Billion Merger of Equals
Monday February 19, 2:47 pm ET
Provides Consumers with Enhanced Content, Greater Choices and Accelerated Technological Innovation Enables Satellite Radio to Better Compete in Rapidly Evolving Audio Entertainment Industry Extraordinary Value Creation for Shareholders Mel Karmazin to Serve as Chief Executive Officer and Gary Parsons to Serve as Chairman of Combined Company

WASHINGTON and NEW YORK, Feb. 19 /PRNewswire-FirstCall/ -- XM Satellite Radio (Nasdaq: XMSR - News) and SIRIUS Satellite Radio (Nasdaq: SIRI - News) today announced that they have entered into a definitive agreement, under which the companies will be combined in a tax-free, all-stock merger of equals with a combined enterprise value of approximately $13 billion, which includes net debt of approximately $1.6 billion.

Conference Call and Webcast Information
The companies will hold a joint conference call and webcast on Tuesday, February 20, 2007 at 8:30 AM ET to discuss this announcement. The conference call can be monitored by dialing 800-573-4840 within the U.S. and 617-224-4326 for all other locations, passcode 29490052. The webcast can be accessed at http://www.sirius.com and http://www.xmradio.com as well as on their satellite radio services by tuning to SIRIUS channel 122 and XM channel 200. The webcast will be archived at http://www.sirius.com and http://www.xmradio.com.

<img src="http://www.sternfannetwork.com/media/xm-sirius-merger.gif" alt="" border="0">


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Under the terms of the agreement, XM shareholders will receive a fixed exchange ratio of 4.6 shares of SIRIUS common stock for each share of XM they own. XM and SIRIUS shareholders will each own approximately 50 percent of the combined company.

Mel Karmazin, currently Chief Executive Officer of SIRIUS, will become Chief Executive Officer of the combined company and Gary Parsons, currently Chairman of XM, will become Chairman of the combined company. The new company's board of directors will consist of 12 directors, including Messrs. Karmazin and Parsons, four independent members designated by each company, as well as one representative from each of General Motors and American Honda. Hugh Panero, the Chief Executive Officer of XM, will continue in his current role until the anticipated close of the merger.

The combined company will benefit from a highly experienced management team from both companies with extensive industry knowledge in radio, media, consumer electronics, OEM engineering and technology. Further management appointments will be announced prior to closing. The companies will continue to operate independently until the transaction is completed and will work together to determine the combined company's corporate name and headquarters location prior to closing.

The combination creates a nationwide audio entertainment provider with combined 2006 revenues of approximately $1.5 billion based on analysts' consensus estimates. Today the companies have approximately 14 million combined subscribers. Together, SIRIUS and XM will create a stronger platform for future innovation within the audio entertainment industry and will provide significant benefits to all constituencies, including:

* Greater Programming and Content Choices -- The combined company is
committed to consumer choice, including offering consumers the ability
to pick and choose the channels and content they want on a more a la
carte basis. The combined company will also provide consumers with a
broader selection of content, including a wide range of commercial-free
music channels, exclusive and non-exclusive sports coverage, news,
talk, and entertainment programming. Together, XM and SIRIUS will be
able to improve on products such as real-time traffic and rear-seat
video and introduce new ones such as advanced data services including
enhanced traffic, weather and infotainment offerings.

* Accelerated Technological Innovation -- The merger will enable the
combined company to develop and introduce a wider range of lower cost,
easy-to-use, and multi-functional devices through efficiencies in chip
set and radio design and procurement. Such innovation is essential to
remaining competitive in the consumer electronics-driven world of audio
entertainment.

* Benefits to OEM and Retail Partners -- The combined company will offer
automakers and retailers the opportunity to provide a broader content
offering to their customers. Consumer electronics retailers, including
Best Buy, Circuit City, RadioShack, Wal-Mart and others, will benefit
from enhanced product offerings that should allow satellite radio to
compete more effectively.

* Enhanced Financial Performance -- This transaction will enhance the
long-term financial success of satellite radio by allowing the combined
company to better manage its costs through sales and marketing and
subscriber acquisition efficiencies, satellite fleet synergies, combined
R&D and other benefits from economies of scale. Wall Street equity
analysts have published estimates of the present value of cost synergies
ranging from $3 billion to $7 billion.

* More Competitive Audio Entertainment Provider -- The combination of an
enhanced programming lineup with improved technology, distribution and
financials will better position satellite radio to compete for
consumers' attention and entertainment dollars against a host of
products and services in the highly competitive and rapidly evolving
audio entertainment marketplace. In addition to existing competition
from free "over-the-air" AM and FM radio as well as iPods and mobile
phone streaming, satellite radio will face new challenges from the rapid
growth of HD Radio, Internet radio and next generation wireless
technologies.

"We are excited for the many opportunities that an XM and SIRIUS combination will provide consumers," said Gary Parsons, Chairman of XM Satellite Radio and Hugh Panero, CEO of XM Satellite Radio, in a joint statement. "The combined company will be better positioned to compete effectively with the continually expanding array of entertainment alternatives that consumers have embraced since the Federal Communications Commission (FCC) first granted our satellite radio licenses a decade ago."

"This combination is the next logical step in the evolution of audio entertainment," said Mel Karmazin, CEO of SIRIUS Satellite Radio. "Together, our best-in-class management team and programming content will create unprecedented choice for consumers, while creating long-term value for shareholders of both companies. The combined company will be positioned to capitalize on SIRIUS and XM's complementary distribution and licensing agreements to enhance availability of satellite radios, offer expanded content to subscribers, drive increased advertising revenue and reduce expenses. Each of our companies has a strong commitment to providing listeners the broadest range of music, news, sports and entertainment and the best customer service possible. We look forward to sharing the benefits of the exciting new growth opportunities this combination will provide with all of our stakeholders."

The transaction is subject to approval by both companies' shareholders, the satisfaction of customary closing conditions and regulatory review and approvals, including antitrust agencies and the FCC. Pending regulatory approval, the companies expect the transaction to be completed by the end of 2007.

SIRIUS's financial advisor on the transaction is Morgan Stanley and Simpson Thacher & Bartlett LLP and Wiley Rein LLP are acting as legal counsel. XM's financial advisor on the transaction is J.P. Morgan Securities Inc. and Skadden Arps, Slate, Meagher & Flom LLP; Jones Day; and Latham & Watkins LLP are acting as legal counsel.

Conference Call and Webcast Information

The companies will hold a joint conference call and webcast on Tuesday, February 20, 2007 at 8:30 AM ET to discuss this announcement. The conference call can be monitored by dialing 800-573-4840 within the U.S. and 617-224-4326 for all other locations, passcode 29490052. The webcast can be accessed at http://www.sirius.com and http://www.xmradio.com as well as on their satellite radio services by tuning to SIRIUS channel 122 and XM channel 200. The webcast will be archived at http://www.sirius.com and http://www.xmradio.com.


Source: SIRIUS Satellite Radio; XM Satellite Radio


http://biz.yahoo.com/prnews/070219/nym038.html?.v=75


Sorry so long.

C.Hill
 

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Can I get the cliff notes on this?

What does this mean for current XM users? Get more channels?

Will stereos with Sirius controls be compatible with the radios? I'm wanting a JVC with sat radio control, should I wait?
 

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shaken, not stirred
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Some places are calling this a merger but Sirius is buying out XM for 3.75 billion. Nothing is going to change this year, most likely you would notice something next year. For the next couple of years they are going to use both formats and both XM and Sirius recievers will recieve the new siglne when it comes out. It will be a super station. So for both subscribers it will work out.

C,Hill
 

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The transaction is subject to approval by both companies' shareholders, the satisfaction of customary closing conditions and regulatory review and approvals, including antitrust agencies and the FCC. Pending regulatory approval, the companies expect the transaction to be completed by the end of 2007.
That's the one thing that will kill this "merger". 1 company owning all the satellite radio licenses, not gonna fly very well with the powers that be.
 

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1 company owning all the satellite radio licenses, not gonna fly very well with the powers that be.
And wait until you see what they'd do with the rates with no competition. Get 15 million people hooked on satellite radio, and what ya' gonna' do when it goes to $20, then $25, then $30 per month? Competition is the only thing keeping the prices where they are right now, and if that goes away, I guarantee you'll see the rates double within 3 years... Either that, or it will start getting tons of advertising, (how else are they going to pay Howard Stern over $500 million, Opra over $50 million, etc...).
 

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You XM subscribers are finally going to get some good content to listen to if the merger goes through.

Howard Stern did not get paid 500 million dollars. That is the money he has to produce his show for 5 years. The increase in subscriptions since Howard started has already paid for the 5-year contract. In fact, I think he also got a very LARGE bonus this year. So they have plenty of revenue coming in.

I understand what you are saying about competition, but XM was hardly competition for Sirius. XM was going downhill FAST. Before HS started, XM had approx. 6 million subscribers and Sirius had 600,000. A year later and XM only has the lead by less than 1 million subscribers. If I were XM's CEO I would be sweating.

I don't see the Oprah channel getting renewed either. There is no content, it is just a rebroadcast of her TV show. Hiring Oprah was XM's last-ditch effort to attract subscribers. It didn't work.

If you are worried about rates going up, just buy a lifetime subscription. Also, Sirius doesn’t make all its money on subscriptions. Most of their money is made by selling their hardware (radios) and accessories.

Baba Booey, baba booey!!!!!!
 

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Not to mention, neither of the companies has actually generated any real profit the entire time they've existed.

Oh well, I don't even listen to the normal AM/FM, so I don't really think I'll be bugged if you guys gotta pay 250 bucks a year for satellite radio, if you want it get it, if not don't.
 

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you do realize that satellite radio doesnt "corner" the market after the merger goes through, they have to compete with the other mediums also.....including HD radio which happens to be free and all the internet broadcasts. Besides, the FCC doesnt have jurisdiction in space.
 

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Alot of people haven't watched over-the-air broadcast TV in many, many years too... imo that's one of the biggest changes in television since color was introduced. A vast part of the population has ditched the free airwaves for pay TV via cable and satellite transmission...

Now they are ditching the analog transmission standards and analog tv set designs that were developed for that old transmission medium they no longer use anyway.

That's a good thing. but I'm not sure what it all has to do with the Sirius/XM Radio merger/takeover...
 

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There's gonna be a big change with analog TV, though.

On February 17, 2009, television will undergo the biggest change since color was introduced in the 1950s. That’s the date on which analog television broadcasting will end.
It will no doubt be one of the darkest days in the safety and overall well being of each and every citizen in the United States and no one has taken a moment to notice what will happen as a result of this change. Having experienced multiple events (hurricanes) where all utilities ceased to be available (including a number of radio stations)TV was the only informative link to the outside world for weeks at a time. As a result of this change no existing or currently manufactured television of any kind is equipped for this change. It’s only a little thing but if you have experienced this kind of disaster you’d understand how stupid the decision to discontinue analog service for the foreseeable future.
 

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get outta da stone age mang


ooga booga!


and it isn't being discontinued... they are using TWO of the MANY ranges for emergency services radios and uh... future reservations


personally stupid to me... since simulcast is a pain in the ***... i wouldn't mind leaving it as it is now... digital customers enjoy local "broadcast" stations in digital picture.. while those that don't... still get to keep current on some events
 

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It will no doubt be one of the darkest days in the safety and overall well being of each and every citizen in the United States and no one has taken a moment to notice what will happen as a result of this change. Having experienced multiple events (hurricanes) where all utilities ceased to be available (including a number of radio stations)TV was the only informative link to the outside world for weeks at a time. As a result of this change no existing or currently manufactured television of any kind is equipped for this change. It’s only a little thing but if you have experienced this kind of disaster you’d understand how stupid the decision to discontinue analog service for the foreseeable future.
Being a little dramatic aren't we? You live in FL, so do I. it's each and every persons responsibility to be prepared. The real disaster you need to be prepared for is hurricanes not the cessation of analog TV broadcasts. lol

Just buy a new ac/dc digital TV for hurricane season and other occasional/travel use. If you can afford to be surfing the internet on your computer then a new small TV shouldn't be to much of a burden to afford, or so I would think. If your really attached to your inferior analog TV set you'll be able to buy a converter/tuner that'll convert the digital broadcast to an analog signal you old TV can display.
 

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As a long term XM subscriber I am allowed to veer and meander as I see fit (not to mention the pomposity afforded me as a moderator. )
huh??...what does being a long term XM subscriber have to do with anything? All it tells me is you wasted a lot of money on a inferior satelite service.

I have spent MANY hours in a car with XM and I couldn't find my CDs fast enough. There must be some gun channel that you Florida boys like to listen to that I don't know about. :D

Set a good example and keep on topic.

and....if you don't want to keep in topic. Did you ever find a medium light blue wrinkle power coat. Similar to the Ford GT valve covers?

 

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huh??...what does being a long term XM subscriber have to do with anything? All it tells me is you wasted a lot of money on a inferior satelite service.

I have spent MANY hours in a car with XM and I couldn't find my CDs fast enough. There must be some gun channel that you Florida boys like to listen to that I don't know about. :D

Set a good example and keep on topic.

and....if you don't want to keep in topic. Did you ever find a medium light blue wrinkle power coat. Similar to the Ford GT valve covers?

[/QUOTE]

what is so superior about sirius? that they have howard? nifty, besides the fact Sirius has him on a 4 second delay because some execs are happy with his content or that the only way Sirius would be able to get support from other mainstream companies like disney is if they merged with XM? or the fact that other than NFL, the only major sport they carried until last month was SEC? Since XM has every other sport covered? im sorry, but when i listen to MY XM service, i dont wanna hear the same **** i can hear on CD or the ipod plugged into my Alpine.
 

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huh??...what does being a long term XM subscriber have to do with anything? All it tells me is you wasted a lot of money on a inferior satelite service.

I have spent MANY hours in a car with XM and I couldn't find my CDs fast enough. There must be some gun channel that you Florida boys like to listen to that I don't know about. :D

Set a good example and keep on topic.

and....if you don't want to keep in topic. Did you ever find a medium light blue wrinkle power coat. Similar to the Ford GT valve covers?
and just so we are on the same page, Sirius' stock condition was worse than XM's just before the merger. Joining because Howard Stern is on your station only shows a lack in overall content and disinterest in B sides.

Also, Sirius has HALF the traffic coverage as XM and has to overlap their broadcast, way to go on the ****ty bandwidth, next, why would i want french and korean language radio? im paying for something I cant use, you have Martha, WTF is that? So, you can say how subpar the XM service is all day long, but I can drive from Miami to Orlando and get all the traffic coverage I need on 2 stations, I dont have to wait for the cheap simulcast to end.
 
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