XM + Sirius Merger Synergies Could Reach $6.7B

Tuesday, January 23, 2007 at 9:40 AM
Tags: 2, XM

XM Sirius MergerThe merger of XM Satellite Radio and Sirius Satellite Radio could create the net present value of $6.7 Billion in savings and synergies, according to Bear Stearns analyst Robert Peck.

That figure is taking into account "several simplifying and sometimes conservative assumptions" including no revenue from additional services and the fact that both companies would likely have to operate both satellite systems in the near term to prevent a disruption in service.

Peck believes that the largest contributor of cost savings would come from OEM and programming, while - unlike the NY Post's assumption - content costs would not be reduced upon renewal "as DARS will still compete with other delivery technologies."

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All this merger speculation is really starting to get silly. Lets see, both companies claim that they are now cash positive. Both companies are growing. Both companies stock increases everytime the fickle public reads one of these speculations.. Why would either company merge with the other when all they have to do is whisper something about a merger every few days and have their stocks jump like a trained dog...

In more news that is never going to happen; Madonna announces that she is moving back to Jersey, John Mayer wins a UFC, Tom Cruise is relaxed and stable, and Osama Bin Laden turns himself in.

Not sure but once you give this "content" all this money (Stern/MLB/Stewart/ECT) you think a merger is really going to reduce this cost.

Sure you won't have competing bids so cost might not increase but i don't see something less then a mega deal again for STern/MLB/Stewart at the end of their contracts.

Think stern would do another 5 years for something less then he is getting now? Think MLB would take less then another long term deal for 600m? Ophra taking a pay cut next negotiation GOOD fucking LUCK. SatRadio needs them more then they need SatRadio....

Oprah will be gone at the end of her deal and Hoo Hoo will retire with his pile of cash to the hamptons with Alison, Alison. Oh yeah, now it's horse-face. Neither company will have to worry about paying them. Sirius will have to figure out what the fuck they are going to do without Stern and all the fans that drop the sertvice the day he goes away.

Peck is wrong, I am right.

I thought Stern was a non-factor PFreak. O&A said that he only has a couple of 100,000 listeners. They have more listeners than him in satellite radio only. Did they lie? Blasphemy!

hmmm... Both companies are in the best financial shape they've ever been in. Where was all this merger talk when they both actually needed it? But, your right, I'm makeing some money on it every time it comes up. At first I thought all this talk was just a ploy by XM and Sirius to get the stock prices up (it works..) But now I think it is these advisors who are trying to get the stock prices up...
I heard XM is merging with Discovery Channel (Their headquarters are just 6 miles from each other and are supposedly working on a big partnership deal...)

"I thought Stern was a non-factor PFreak. O&A said that he only has a couple of 100,000 listeners. They have more listeners than him in satellite radio only. Did they lie? Blasphemy!"


Nope he wants it both ways, wants to say there was "no stern effect" but then later say Sirius will loose 4m people when stern leaves. Sad Sad Man i await your witty comment on my mother or me being gay or something...

I've never said there was no Stern effect, that's crazy. I just think it's long over, most of the Stern people have signed up and his subs are more of a trickle now. I absolutely don't expect him to stick around after his deal is up and there will be a lot of people that signed up only for him that will cancel. Sirius won't lose 4 million people, there isn't even half that many that signed up for Stern but I wouldn't be surprised if at least half of those walked when he does.

I'd leave a witty remark but you're probably too busy touching a young boy to read it.

PFreak, saying that Sterns fans will leave is like saying Satellite radio sucks and there is no point to listen to it unless you are stern/o&a fan which we all know is completely ridiculous. People will stay maybe not all but a lot more than you think because they recognize the value in the product after Stern brought them in.

Do you think people are going to leave and go back to your favorite station (FreeFM) or on to your favorite sat. service.

"People will stay maybe not all but a lot more than you think because they recognize the value in the product after Stern brought them in."

no i have to agree with PFreak, if sirius does not sign stern for another long term deal they will loose ALOT of subs...maybe a million or more rabid stern fans who are only there for stern

Wow, we agree. The end of the world must be near. And for the record I'm sure some of those Stern subs will indeed realize they're getting a great service and stay. Unfortunately a lot will not. They are paying to hear Howard all day long and when he's gone they will be too.

"Wow, we agree. The end of the world must be near. And for the record I'm sure some of those Stern subs will indeed realize they're getting a great service and stay. Unfortunately a lot will not. They are paying to hear Howard all day long and when he's gone they will be too."

I, too, agree with you. I wouldn't be surprised if Sirius lost half of Stern's fans if he left. I would guess close to 2 million subs...

Mel's no dummy, however. I'm sure they're already planning for that possibility...

Funny cause if stern leaves i know my 3 subs are gone and i will only be left with my XM sub...since they have better music selection....

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