Filed under: Deals, XM Satellite Radio (XMSR), Sirius Satellite Radio (SIRI)
The Justice Department has approved Sirius Satellite Radio Inc. (NASDAQ: SIRI)’s $5 million buyout of XM Satellite Radio Holdings Inc. (NASDAQ: XMSR), on the grounds that the deal is not likely to hurt consumers or competition.
In a press release, the Justice Department said that “The likely evolution of technology played an important role in the Division’s assessment of competitive effects in the longer term because, for example, consumers are likely to have access to new alternatives, including mobile broadband Internet devices, by the time the current long-term contracts between the parties and car manufacturers expire.”
And that is exactly why I wouldn’t touch either of these companies. The Justice Department is essentially saying that emerging technology will make satellite radio a small enough part of the industry that consumers won’t be harmed by the 2 biggest players merging. Do you really want to own a money-losing entity that will be facing increased competition over the next few years because of new alternatives for consumers?
Continue reading XM/Sirius cleared to merge: Don’t buy Sirius
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