XM/CBS take-over Rumor

Thursday, March 30, 2006 at 10:15 AM
Tags: 2, XM

BREAKING
According to theflyonthewall:

09:59 EDT XMSR theflyonthewall.com: XM Satellite Radio-XMSR trading higher on take-over speculation-Rumor :theflyonthewall.com

09:57 XMSR XM Satellite: rumor of CBS for XMSR; price talk said to be $27 (21.92 +0.12)

More on this as news develops.
Note: this should be considered a rumor until we find out more.

UPDATE: This from Briefing.com

Hearing CBS-for-XMSR chatter making rounds

UPDATE 2: More from Briefing.com:

by: ubscibc

BRF 10:33 XMSR: XM Satellite: Color on takeover chatter [UPDATE]

[Live In Play]

XMSR: XM Satellite: Color on takeover chatter (22.20 +0.40)
[Update]
Following takeover rumors in XMSR today (with CBS cited as a potential buyer... see 9:58 comment), we listened to yesterday's CBS conference call for any possible insight. During the call, CBS was asked directly about Univision (UVN), and their response was "I think Univision is a great company but there are two major issues for us. One is valuation and the other is regulation... other than that it is a wonderful asset." Co stated that they did not think they could clear the first hurdle... Approx 5 minutes later co was asked what they would do with their free cash. Co stated that they want to pay dividend; thinks that it is a higher threshold of confidence and best use of cash; says they would like to keep increasing the dividend. Co also stated that they are not interested in a large acquisition -- say in the $12-13 bln range -- but could be interested in a smaller acquisition in the $300 mln range (i.e. College Sports TV) that would be fairly valued and would fill a void for the co. Says acquisition has to be attractive and be able to grow... Briefing.com
Note: Given yesterday's comments by CBS, with a market cap of approx $5 bln it would not appear that XMSR would fall into the acquisition profile that CBS is interested in.

Briefing.com, Inc.

UPDATE 3: Gary Parsons at the BofA MET Conference stated that he "certainly" wouldn't comment on this rumor.

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Comments

What do you think will change? All of the sudden a Satellite company will be regulated like terrestrial? CBS and XM employees have been working together very closely for over a year, while sharing programming out of necessity. Not the case with Sirius. Who was the originator of hyper-commercialized radio anyway? Not Dan Mason or Hugh Penero, but Mr. Karmazin. Plus its an easier move as far as passing the SEC is concerned. In my opinion, better move that would make both companies more stable and allow them to keep at the great experiment: FM talk radio on both terrestrial and satellite. XM CBS and Sirius need the support of the other, clearly I would choose the two that have been and are colleagues presently.

What do you think will change? All of the sudden a Satellite company will be regulated like terrestrial? CBS and XM employees have been working together very closely for over a year, while sharing programming out of necessity. Not the case with Sirius. Who was the originator of hyper-commercialized radio anyway? Not Dan Mason or Hugh Penero, but Mr. Karmazin. Plus its an easier move as far as passing the SEC is concerned. In my opinion, better move that would make both companies more stable and allow them to keep at the great experiment: FM talk radio on both terrestrial and satellite. XM CBS and Sirius need the support of the other, clearly I would choose the two that have been and are colleagues presently.

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