XM-Sirius at the Senate Today: Witnesses For & Against

Today may be another important juncture in the XM (XMSR) & Sirius (SIRI) merger because this follow-on meeting could further set the tone of how regulators treat the proposed merger between the companies.  The Senate Committee on the JudiciarySubcommittee on Antitrust, Competition Policy and Consumer Rights has ascheduled hearing on “The XM-Sirius Merger: Monopoly or Competitionfrom New Technologies” TODAY at 2:15 p.m. in Room226 of the Senate Dirksen Office Building with Chairman Kohlpresiding. 

We have our own opinions on this and we havenoted in the past that the deal seems more likely to be approved withsome severe conditions attached, and we have also noted that thecompanies both appear to need the deal to be completed for them to both haveready access to more liquidity and to the capital markets.  That is ouropinion ahead of time, but we obviously cannot say what the realoutcome will be and won’t try to guess what the formal votes are or howlong it will take to secure the votes.

Today’s hearing before the Senate Committee on the Judiciary Subcommittee onAntitrust, Competition Policy and Consumer Rights on “The XM-SiriusMerger: Monopoly or Competition from New Technologies.”   Here is who is acting as witness and the "Known" opinions of how each will testify:

Mel Karmazin, Chief Executive Officer, Sirius Satellite Radio
New York, NY (Mel K. is obviously FOR the merger)

Mary Quass, President and CEO, NRG Media, LLC
CedarRapids, IA (she represents theNAB which is "very strongly opposed to the merger."  NRG Media consists of 84 radio stations throughout 7 statesin the Midwest and the Waitt Radio Network, based out of Omaha,Nebraska; ranked as 7th largest radio network in US)

David Balto, Attorney at Law, Law Office of David Balto
Washington,DC (antitrust lawyer who was policy director of the Federal TradeCommission during the Clinton administration; formal opinion or stancenot known/confirmed because of what has been mixed commentary reporting)

Gigi B. Sohn, President, Public Knowledge
Washington, DC (advocacy group that previously told the HOUSE COMMITTEE the merger should be approved subject to Three Conditions:new company makes available pricing choices such as a la carte ortiered programming; new company makes 5% of its capacity available tonon-commercial educational and informational programming over which ithas no editorial control; new company agrees not to raise prices forthree years after the merger is approved)

We will follow-up with more details when they are known,but they might not be known until after the meeting tomorrow.  With themarket up yesterday, SIRI closed up 1.5% at $3.29 and XMSR closed up 2.1% at $13.44.

Jon C. Ogg
March 19, 2007

Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.