New York, NY – UPDATE: Merger announcement official  XM Satellite Radio Holdings Inc. and Sirius announced a merger today, as expected according to a New York Post report.  Negotiations for the deal took place over the weekend.  An agreement would still need to pass an antitrust analysis from the Department of Justice, and the FCC would need to waive its clause saying one satellite radio company cannot own the other.  Early predictions indicate that it could take up to 15 months to gain approval.  XM shareholders will get 4.6 shares of Sirius stock for each share of XM stock held.   

XM Chairman Gary Parsons will keep his title after the merger, and Mel Karmazin, head of Sirius, will assume the CEO position.  Current XM CEO Hugh Panero will continue in his role until the merger is finalized.

A combined XM-Sirius entity would boast 14 million subscribers, and analysts say a total of $7 billion would be saved annually between the two.  "This combination is the next logical step in the evolution of audio entertainment," said Karmazin in a statement.

XM shares dropped to its lowest price since November on Friday and Sirius drew close to its 52-week low.  Both companies saw overall gains on the day, however, as rumors spread that a possible merger might pass regulatory obstacles.

Scott Goldberg

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