XM-Sirius Merger Approval Close?
FCC may finally be ready to sign off on satellite-radio merger.
By John Eggerton -- Broadcasting & Cable, 6/30/2008 9:07:00 AM
Could the Federal Communications Commission finally be ready to sign off on the XM Satellite Radio-Sirius Satellite Radio merger? The Justice Department already gave it a green light.
FCC chairman Kevin Martin has said that he would like to get it done soon, although lately, he has provided no timetable. But the commissioners have had an item before them that proposes a series of conditions under which the deal could be approved, and at least one prominent broadcast lobbyist suggested that the deal might be close to being done.
An aide to one commissioner said meetings on the deal were still scheduled for this week but did not rule out a decision either, though another aide suggested to look for something after the July 4 weekend.
Meanwhile, some Democrats were saying last weekthey were still not happy with the conditions offered up by the companies.
But whether it was in anticipation of a decision or as some extra impetus for it, Sirius Monday was sounding optimistic, releasing guidance on what the financial upside for the merger would be in 2009 "assuming completion of the merger" by the third quarter.
According to Sirius, combining the companies would mean cost savings of $400 million in 2009, achieving "positive free cash flow" and showing net income of $300 million before investment income, interest, depreciation and amortization.
Sirius pointed out that neither it nor XM have had positive net earnings or cash flow as separate companies.
Sirius will be the surviving parent company after the merger.
An FCC spokesman was unavailable for comment about the timing of a decision. The commission is now in its 387th day of considering the merger, and the companies have regularly delayed a date for unwinding the deal absent regulatory approval.
