The $13 billion merger may not go through
This week, formal Attorney General John Ashcroft voiced his opinion on the recent merger announcement from Sirius Satellite Radio and XM Satellite Radio. Mr. Ashcroft, along with the National Association of Broadcasters, is very much against the merger of Sirius and XM.
Alberto Gonzales, the current U.S. Attorney General, received a letter from Ashcroft this week detailing his opinion on the Sirius-XM merger. According to the letter, Ashcroft viewed the merger as a threat to consumers, indicating such things such as price hikes and lower quality services and products. Ashcroft even compared the merger to that of the attempted takeover of Echostar Communications and Hughes Electronics Corp.
The Sirius and XM's final merger has not yet received grace from the Federal Communications Commission (FCC). The entire deal will amount to roughly $13 billion USD, and will have shareholders from both companies owning roughly 50-percent of each company.
Despite all the hurrah about Sirius and XM however, both companies must still past the Department of Justice's anti-trust unit and an FCC investigation. What happens later is unknown, however, analysts predict that Sirius and XM will face an uphill battle for the merger.
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