It’s been the subject of speculation for months, but today XM Satellite Radio and Sirius Satellite Radio officially announced their plan to merge into a single company:
District-based XM Satellite Radio Holdings Inc. and New York-based Sirius Satellite Radio Inc., which together control the emerging satellite subscription radio market, today announced that they plan to merge in a $13 billion deal.
Mel Karmazin, the chief executive of Sirius, would become chief executive of the new company, and Gary Parsons, the chairman of XM, would become chairman, the companies said. They also said they would retain operations both in New York, where Sirius rents space, and in Washington, where XM owns a building.
From an economic standpoint, the merger makes alot of sense but that doesn’t mean it’s a done deal:
Such a merger would face significant regulatory scrutiny and questions about whether a monopoly was being created and would take months to complete. The companies hope to complete the merger by the end of the year.
And, as I wrote last month at The Liberty Papers, the chairman of the Federal Communications Commission has already said he would oppose an XM-Sirius merger.
