A-La-Carte Discussed With FCC
Counsel from Sirius and XM met with the FCC Commissioner and various staff on March 26th, 2008. The topics of discussion centered on merger filings consistent with that which has been discussed in the past. As part of the meeting, Sirius and XM showed the proposed A-La-Carte channel line-up for post merger satellite radio. The company urged the FCC to deliver prompt approval.
Not that A-La-Carte programming was ever out of play, but this meeting would tend to suggest that it is indeed a merger concession that will likely be demanded by the FCC.
Interestingly, the comments urging the FCC for prompt approval, while expected in this situation, would also seem to indicate that the regulator is now to the point of weighing the merger options. This would be consistent with comments made by Chairman Martin that the staff was drafting documents outlining various merger situations.
Reading between the lines, it is possible that various concession options were discussed at this very meeting.
The FCC published their weekly “Items In Circulation” list today, and the Sirius XM issue was not present. At this point it would appear that the FCC is close to rendering their decision. They are meeting with company counsel, and seem to have all relative information in their hands to consider.
I would estimate that the FCC will be delivering a decision sometime in April, and place higher odds on the middle third of the month.
Position - Long Sirius, Long XM
March 28th, 2008 at 9:52 pm kevin Says:
So much for my guarantee on Mon.
March 28th, 2008 at 11:50 pm john Says:
Tyler, I have read in various news articles, that most of the time merger decisions such as this have had special meetings called when a decision has been reached and will be given. That these items are not generally put on the, items in circulation list. Given the volatility of the stocks I can see why they would not want to telegraph a forth coming decision.
March 31st, 2008 at 10:50 am hippocritical ass Says:
I’m trying to figure out why anyone cares anymore. Based on the market’s reaction to the DOJ approval (previously, considered the bigger hurdle), it seems everyone has figured out there is little value in the merger anyway.
March 31st, 2008 at 2:25 pm 100LB Emaciated Gorilla(TM) Says:
The DOJ may have been a bigger hurdle as far as the overall merger is concerned, but the FCC still holds the keys to the future viability of programming/content distro - not to mention if they get freaky with forcing them to subsidize competition (which I think is one of the dumbest ideas ever)
April 1st, 2008 at 11:32 am john Says:
Hippo, it is due to the fact that most investors know no real savings will happen for at least a year after a merger, and most savings wont come until the second year after the merger.
April 1st, 2008 at 2:15 pm hippocritical ass Says:
>>>> Hippo, it is due to the fact that most investors know no real savings will happen for at least a year after a merger, and most savings wont come until the second year after the merger.
The synergies estimates take into account the time value of money. If anyone believed the NPV of synergy values might be 7 billion dollars, they’d be all over these stocks, unless they have doubts about merger happening (which I suspect they do not).
The reality has set in that some so-called “analysts” estimates are not quite the same thing as actual savings. You have to actually make it happen, which is far more difficult than making the merger happen ever was.
April 3rd, 2008 at 1:33 pm john Says:
If that is the case hippo then why was SIRI and XMSR spread so far apart after the DOJ approval. That should have closed to 3 or 4 % right after the DOJ decision. Also there you go again, using the highest estimate to try a argue your point. When you should be using the average which is about 3.5 billion if you want to be honestly nonbias.
April 4th, 2008 at 12:22 pm john Says:
There you go hippo, Credit Suisse just confirmed my position.