The line has been drawn in the sand, and now some of that sand is going into an hourglass. Sirius
There's no point in worrying about cold feet now. The vote is taking place nearly nine months after the companies announced their matrimonial intentions. If investors haven't been won over by the huge synergies -- and consumers haven't been swayed by the lower-priced plans -- there's little left for Sirius CEO Mel Karmazin to say to win them over.
Besides, it would be a shock if a majority of the shareholders aren't on board with the deal. Both XM and Sirius are trading well below the all-time highs set nearly three years ago. Subscriber growth without fiscal responsibility has been meaningless to Mr. Market. A combined company would be able to watch over more than 15 million subscribers with substantially healthier margins than each company on its own.
|
12/04 Peak |
10/8/07 |
Loss |
|
|---|---|---|---|
|
XM |
$40.89 |
$14.26 |
(65.1%) |
|
Sirius |
$9.43 |
$3.45 |
(63.4%) |
Obviously, getting its investors on board isn't the concern. The merger is being treated to rigid regulator scrutiny. After the proposed pairing of DirecTV
One way or another, expect a lot of that uncertainty to clear before the shareholder vote. XM and Sirius have jumped through every hoop tossed at them by the regulators. In the meantime, automakers have vindicated the claim that satellite radio is not a monopoly. Some carmakers have inked deals to include HD-radios and Apple
If that still isn't enough, expect deal critics to act swiftly. It just isn't fair to keep teasing XM and Sirius this way.
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