Sirius deal wins Justice backing
Sirius (SIRI) spiked after the Justice Department cleared the satellite broadcaster’s plan to merge with rival XM Satellite (XMSR). The decision, which came over the opposition of the free-to-air radio companies represented by the National Association of Broadcasters, means the companies now need only to secure approval from the Federal Communications Commission. FCC chief Kevin Martin last week signaled his agency may well be leaning toward a conditional approval as well, when Reuters reported the FCC was working on drafts that included conditions upon which the deal could be approved.
An approval of the Sirius-XM merger would bring an end to more than a year of waiting since the companies proposed the deal back in February 2007. On Monday, Sirius rose 7% and XM surged as much as 16%, as once-skeptical investors flooded back into the shares. Even now, though, Wall Street continues to price the shares as if a deal might not happen: XM shares recently traded at $13.75 apiece, a discount of around 4% to the indicated value of Sirius’ all-stock offer.
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FINALLY…they acknowledged there is plenty of competition. NAB/Clear Channel can put that in their pipe and smoke it.