XM and CBS
April 22, 2006 1:03PM EST
File this piece under Speculation.
Satellite Standard Group (SSG) as well as others have seen and heard speculation about XM working with CBS.
This week news broke that XM shock jocks Opie and Anthony would become available on terrestrial radio in seven markets. They will be replacing David Lee Roth.
Is this the end of the CBS and XM relationship, or merely the beginning?
XM has indicated that they could very well be seeking a partner for their WCS spectrum (should it be approved) which services 15 markets. The WCS deal upon approval will cost XM 5,500,000 shares of stock. At the time the deal was announced, the stock was at $36.00. Approval of the deal in the current stock price range would certainly help keep the share expense down for XM (the deal is still 5,500,000 shares).
There is a lot of speculation about the WCS spectrum, and what type of services or content XM intends to deliver with it. At a minimum, if they want current subscribers to be able to use the service, upgrades would be in order.
SSG has no information that the XM and CBS relationship is anything more than the Opie and Anthony deal, but given the recent pronouncements about bringing in a partner, it may well be something that is being considered.
Perhaps adding to the speculation may be the recent refinancing package that XM did. This refinancing removed some very steep fixed payment obligations, and will do very well for the balance sheet.....something a potential partner may be more comfortable with.
As stated earlier, this is simply speculation.
The link to this write up is http://tinyurl.com/z3bao
4/22/2006 01:00:00 PM
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