Sirius, XM merger completed, creating US satellite radio giant
WASHINGTON (AFP) — US satellite radio giants Sirius and XM completed their merger Tuesday after winning a lengthy battle with regulators over concerns about market competition.
The new company formed by Sirius Satellite Radio's buyout of XM Satellite Radio, will be called Sirius XM Radio Inc.
The combined company has more than 18.5 million subscribers, making it the second-largest radio company, based upon revenue, in the country.
But the company has "significant" growth prospects because it currently has cornered less than 10 percent of the home and car market, it said.
"We have worked diligently to close this transaction and we look forward to integrating our best-in-class management teams and operations so we can begin delivering on our promise of more choices and lower prices for subscribers," chief executive Mel Karmazin said in a statement.
The Federal Communications Commission approved in a 3-2 vote Friday all-stock buyout of XM, ending some 16 months of regulatory limbo for the nation's only satellite radio companies.
Company executives have long argued that the merger would lead to major cost savings and the first-ever profits in the fledgling industry.
Some critics of the deal had argued that a combined satellite group would form a monopoly that would benefit from sharing the same broadcast stars and could bring an end to bidding wars for top talent.
The deal was approved by XM and Sirius shareholders last December, when Sirius had more than 8.3 million subscribers compared with nine million for XM.
The new company broadcasts more than 300 channels of programming, including exclusive radio broadcasts from shock-jock Howard Stern, television magnate Oprah and home-decorating guru Martha Stewart.
The FCC approval marked the final regulatory hurdle needed for the merger, which passed antitrust scrutiny by the Justice Department in March.
When the companies first began publicly discussing the merger, in February 2007, the deal was valued at 13 billion dollars.
Sirius XM Radio shares plunged 19.68 percent to 1.51 dollars in opening trade Tuesday.