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Old 01-14-2007, 02:40 AM   #16
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Sirius can't pay its light bill on its own right now, and nobody in their right mind would lend them any money to buy XM.
You would be amazed at how much money could be raised to create a virtual "Monopoly". Mel is capable of raising the money, it isn't clear that XM is. Therefore I would give the edge To Sirius. Also the higher market cap stock generally has an edge. Sirius 5.7, xm 4.6B.
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Old 01-14-2007, 02:38 PM   #17
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You would be amazed at how much money could be raised to create a virtual "Monopoly". Mel is capable of raising the money, it isn't clear that XM is. Therefore I would give the edge To Sirius. Also the higher market cap stock generally has an edge. Sirius 5.7, xm 4.6B.
Mel is NOT capable of raising the money unless he can show how such a business will be profitable, and to do that he is going to have to explain his continued support for an $800 Million Plus expenditure for Howard Stern.

Lenders do not lend billions on Mel's (or anyone else's) signature.

If there is any kind of acquisition, XM will clearly be the acquirer. Personally, I think a merger is a more likely scenario, and neither is very likely.
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Old 01-15-2007, 02:40 AM   #18
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If there is any kind of acquisition, XM will clearly be the acquirer. Personally, I think a merger is a more likely scenario, and neither is very likely.
Usually the company with the larger market cap has the upper hand. That would be Sirius at this moment. Not only that, Sirius has the momentum. Which management team would investors be more comfortable with, Sirius's or XM's? That would be where they would want to place their bets.

Doesn't a merger still require one of the companies to buy out the other? I don't see a big distinction between an acquisition and a merger.
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Old 01-15-2007, 05:51 AM   #19
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Where there is a will, there is a way.

I note that synergies savings are again reported again this morning at 5-6 Billion long term. This isn't lost on the company executives, the lenders, or the loan recipients.

One can't forget that the combined retail is 1.7 Billion and will add .5 billion in 2007. This in itself, is a credit line.

I am no longer concerned about the recognized need, or cash to produce a deal. It's ALL down to regulators who are political and smart enough to know that no one wins if the merger doesn't happen.

I am almost to the point where I believe Representatives in Congress will " fully lubricate " a deal for the back scratching it accomplishes.

An advanced technology, tax revenue, national communications/defense ( warnings ) , RIAA cookie, entertainers. ( Consider if we are attacked again, the tremendous value of Satrad )

Congress wouldn't look to spiffy ( their main concern is how they look/get re-elected ) if they let a worldwide technology ( at a time when American Jobs are being lost ) suck teat and die....especially if another country makes it work. It just doesn't look technology or business friendly does it ?

Those who suggest that the FCC are fully / politically independent, are naive.

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Old 01-15-2007, 09:03 AM   #20
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Content IS king and Sirius has shown how it's done. Sirius will probably overtake XM in subscribers sometime this year, and they know that full well over at XM. I think a merger would make more sense sooner than later for them now, while they are still leading in subscribers.
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Old 01-15-2007, 09:31 AM   #21
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Usually the company with the larger market cap has the upper hand.
"Upper Hand" in what way? I hope you aren't trying to suggest, somehow, that Sirius is financially "more able" to acquire XM, because nothing could be further from the truth. As I said, nobody in his right mind would put up the money for it.

SIRI shareholders have been amazingly willing to give up their interests in Sirius to pay for consumption -- never in 30 years of investing have I seen such a willingness to tolerate wild spending. But raising the money needed for an acquisition is clearly beyond SIRI's capability at this point.

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That would be Sirius at this moment.
Actually, not really. They are roughly at parity now, and we have earnings coming up in which SIRI is going to announce a huge loss that will shock a lot of people, while XM is going to present an extremely positive earnings surprise. At any rate, the difference between them isn't substantial at this point.

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Not only that, Sirius has the momentum. Which management team would investors be more comfortable with, Sirius's or XM's?
I would certainly hope the better management team would stay, and that clearly would be XM's. SIRI's management has done better with Mel, but still hasn't learned to control costs and that is going to be the key to any future success.

But you miss the most important points. XM has more subscribers. XM has the OEM deals which are going to carry the business forward. And most importantly, it is XM's technology that will survive any merger, NOT SIRI's. SIRI receivers will be scrapped. Every last one of them.

Ultimately, this is going to determine who is the survivor of any merger. Who has the best technology in place and the most subscribers.

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Doesn't a merger still require one of the companies to buy out the other? I don't see a big distinction between an acquisition and a merger.
There is a distinction. In a "merger" two or more companies combine with a new company being created in the process. In an "acquisition", one of the companies buys and absorbs the other.

Two totally different things.

For the record, I still don't think there is any real chance of it happening. The references to "synergies" are always without any precise explanation of what exactly those synergies are and there is likely a reason for that. They aren't there.
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Old 01-15-2007, 09:33 AM   #22
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Content IS king and Sirius has shown how it's done. Sirius will probably overtake XM in subscribers sometime this year, and they know that full well over at XM. I think a merger would make more sense sooner than later for them now, while they are still leading in subscribers.
If anything has been shown, it is that content is NOT king, that OEM installs are king, and will be the salvation of SDARS if there is any.

But your remarks sent me laughing. You really know what you're talking about.
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Old 01-15-2007, 10:02 AM   #23
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What's really amusing is all the XM'ers that are now all of a sudden feeling the need to post on our Sirius Backstage board. A new phenomenon. Mel must be doing something right. Welcome aboard.
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Old 01-15-2007, 11:23 AM   #24
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" But you miss the most important points. XM has more subscribers. "

Possibly, but respectfully you may have missed a point also.

They won't for long.

XM is in the final throes of annihilation. You can't lose 5 quarters in a row, lose prime content, give up on retail, and expect to do anything other than limp to the finish line.

2007..... Sirius 2.5-2.7 million XM 1.3-1.5 million.
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Old 01-15-2007, 11:38 AM   #25
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They won't for long.
Nonsense.

Even with Stern SIRI has barely made a dent in XM's subscriber lead if you consider the differences in counting OEM subs (which have ramped up for SIRI during the same period).

I know you guys think it doesn't matter, but it does. When XM counts an OEM sub for at most 4 months before allowing it to churn, while SIRI counts one for up to 18 months before allowing it to churn, there is a systemic difference in the way the subs are counted.

Given a 52% take rate (which is mostly likely high for SIRI, given that they continue to refuse to release the figure without any reason) you have 48% of the OEM subs for SIRI over the last 14 months being counted as though they are "self paying" (the basis XM uses for OEM subs) when in fact they are not AND will drop the subscription when the 18 months have expired.

While SIRI has had a lead in retail lately, it is transitory and there is no reason to expect that it will not continue to return to a 50/50 split in the future.

SIRI has been able to maintain the retail share only by spending more than twice what XM spends to get subscribers. Say whatever you want to, but this fact cannot be rationally characterized as a positive for SIRI. SIRI cannot continue to spend at these levels.

Remember, they missed their guidance by 300K. Retail is not solving SIRI's problems, much as you would like to believe it.
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Old 01-15-2007, 11:59 AM   #26
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Quote:
Originally Posted by Whiskerbiscuit
" But you miss the most important points. XM has more subscribers. "

Possibly, but respectfully you may have missed a point also.

They won't for long.

XM is in the final throes of annihilation. You can't lose 5 quarters in a row, lose prime content, give up on retail, and expect to do anything other than limp to the finish line.
But you can't spend more money to get more subscribers if you are not getting any revenue back and paying to get half your money back is considered a loss no matter how you cut it. Also, if you pay people with your own stock instead of cash, then that would translate to most people as something being wrong with that company.
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Old 01-15-2007, 12:57 PM   #27
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Sirius is on the verge of surpassing XM in subscriber growth, even WITHOUT much of a factory installed OEM presence. That's quite a feat. No wonder XM wants to talk about a merger. By the end of the year, most all the major automobile manufacturers will be pushing for the merger to go through. It's just good bussiness, and common sense.

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Old 01-15-2007, 02:12 PM   #28
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Also, if you pay people with your own stock instead of cash, then that would translate to most people as something being wrong with that company.
Essentially, a "cash call" from the shareholders -- in this instance, without most of them even knowing it happened. They just took it out of their investments, no one the wiser.
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Old 01-15-2007, 02:38 PM   #29
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Originally Posted by hazzar
What's really amusing is all the XM'ers that are now all of a sudden feeling the need to post on our Sirius Backstage board. A new phenomenon. Mel must be doing something right. Welcome aboard.
These guys are just practicing for the "big merge" Ya know.....when SBS buys out xmfan.......its ok guys we'll show ya the ropes...we here at SBS have a soft spot for the underdog
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Old 01-15-2007, 04:41 PM   #30
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No wonder XM wants to talk about a merger
You do know that Sirius/Mel has been doing 99% of the merger talk, don't you?
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