Sirius CEO calls merger an "uphill battle"

Thursday, May 24, 2007 at 3:08 PM
Tags: 2, XM

SiriusAt this morning's shareholder meeting, Sirius CEO Mel Karmazin said that their merger is XM is an merger is an "uphill battle," though he continues to believe that it will be approved by regulators.

Karmazin also acknowledged that Wall Street estimates there is an "80 percent likelihood that the merger is not going to happen." In a generalized response to Senator Kohl's comments denouncing the merger, Karmazin said, "There are some people out there that think that any combination [merger] is bad."

He also noted that "the NAB is a very powerful lobbying organization and we are a relatively small company. We are fighting a very well-oiled lobbying organization in the NAB."

"Why are they hiring John Ashcroft and hiring all these advisors? It’s simple... because we do compete with them. They believe that if we combined, our company would be better, it would be stronger," Karmazin added.

When asked about the prospects of the company should the merger not be approved, Mel said, "Our business model is very much on track. I believe not only are we going to not be out of business, we’ll be a very successful profitable company down the road."

It's good to see Mel taking a somewhat "realistic" (for lack of a better term) approach to the merger prospects. To ignore the cynicism over the deal doesn't instill anymore confidence than if he acknowledges it. People expect management to remain positive over regulatory approval, but also don't want everything to be sugar coated. Mel does this well.

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Comments

Read between the lines. Listen to the share holder conference. The merger was not designed to result in a merger. It was designed to Expose the NAB and what they are doing behind the scenes.

Down with the Merger! Death to the Dark Side!!!

Long live O & A!!!!!!!!!!!!!!!!!

Watch that Sirius stock drop, from less than $3.00/share to $0.00.

Zero point Zero Zero.

The white-haired shyster can't spin it any other way.

Ryan - Mel has done, what's the number - about $80 billion?? - worth of mergers over the years between running Infinity, Westwood One, CBS and Viacom. Do you honestly believe Mel would have went into this deal with XM if he thought he couldn't get it done? I sure don't.

I believe very many people are underestimating Mel Karmazin. Has he ever missed on any one of his mergers? Ever Ryan?

But here's something interesting after talking to several Sirius sales reps. the inside word is even they don't think the merger will happen. Also, Mel has been behind many successful mergers, but this one is unique in the sense that there are only 2 satellite radio companies in existance. If perhaps there were several (as there were on the terrestrial side) the merger would be a slam dunk for him. Personally I don't think the merger will happen. I do however feel both Xm & Sirius need each other to survive but as separate companies.

They should just have XM file for bankruptcy. Sirius should then move in and buy them out. Fuck the merger. What would happen then? FCC would break sirius down into several companys???

CJ Red - You opinion on this post from SSG please

He (Karmazin) was candid and honest, and did say, "the merger is an uphill battle", but the sentence included "I am very positive on the prospects".

http://satellitestandard.blogspot.com/2007/05/sirius-annual-shareholders-meeting_25.html

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