Stanford Group issued a note today regarding the Sirius and XM merger.

REPORT EXCERPTS

DOJ Nears XM-Sirius Ruling

• We believe the Department of Justice (DOJ) is near a ruling on the XM-Sirius merger, and we reiterate our belief that it is likely to win regulatory approval.

• Late last week, a consumer group opposed to the merger met with DOJ antitrust chief Thomas Barnett. We believe this represents a “last chance” meeting that DOJ often gives parties who are likely to lose the battle. Our understanding is that XM and Sirius have not had such a meeting with Barnett.

• As for timing, DOJ’s ruling could come any day now. Shortly after DOJ rules, we expect FCC Chairman Martin to recommend to his fellow commissioners the same outcome reached by DOJ.

• If DOJ approves the merger, there will likely be a battle over merger conditions such as (a) requiring Sirius/XM to include HD tuners in each unit it sells; (b) restricting local advertising or local content; and (c) imposing more onerous terms for the companies’ various pricing/a la carte commitments.

Position - Long Sirius, XM