Citi analyst Eileen Furukawa issued a report on the DOJ approval of the Sirius and XM merger.

REPORT EXCERPTS

Sweet Music to Their Collective Ears

? Still Need FCC Approval But Likely Clear Sailing From Here — As we’d hoped, after over 1 yr of hard fought work, XMSR & SIRI have finally received approval from the DOJ. While FCC approval is still required, we believe it is highly unlikely FCC approval will not be forthcoming shortly, most likely in April.

? Concessions Likely, But Expect Spectrum Is Off the Table — We believe that FCC approval will likely be given only with concessions. We also feel XMSR and SIRI are committed to getting the deal done and thus are amenable to reasonable concessions incl. specific timing req’ms around a la carte pricing. But, we currently don’t expect spectrum concessions will be part of the deal.

? Continue to Believe $6 to $7 Bn in Synergies Possible — We continue to standby our prior line-by-line analysis that suggests the combined satellite entitycould achieve present value cost savings of $6 to$7Billion with 10-20% savings across customer service, programming G&A, R&D, Sales & Marketing, etc.Further, while we do not assume revenue synergies, a combined XM/ SIRI could drive higher ad revenues given larger combined reach. Also, we conservatively did not include cap ex savings from migrating to one system.

Tyler Savery Position - Long Sirius, Long XM