XM Radio, Sirius announce merger
Straight from Ars Technica: “XM Radio and Sirius have put an end to nearly two years of rumor, speculation, and innuendo by announcing a $13 billion merger of equals. Under terms of the merger, the companies will combine in an all-stock, tax-free merger including net debt of approximately $1.6 billion. XM Radio shareholders will get 4.6 shares of Sirius stock for each share of XM common stock that they own, with the result being that the combined company will be made up of a roughly 50-50 split of shareholders from XM and Sirius.Sirius CEO Mel Karmazin will become the CEO of the combined company with XM Radio Chairman Gary Parsons stepping into the Chairman role of the combined company. The new board of directors will be made up of Parons, Karmazin, four independent directors designated by each company, and others. No closing date has been annnounced for a merger.
We have covered past rumors, and Karmazin has frequently voiced his opinion that a merger would be a good move for both the companies and their shareholders. It makes sense from a financial standpoint: both companies have heavy debt, relatively weak cash positions, and sizable market caps. A merger of equals would allow for an all-stock deal. It would also give subscribers access to the combined programming of both companies, including the sports programming currently divvied up between the two.”