If XM Satellite Radio and Sirius Satellite Radio’s proposed merger is approved, the new company’s headquarters could end up in New York, though XM said this will not mean a loss of jobs at its D.C. facility.
Washington-based XM and New York-based Sirius announced Monday their plans for a $13 billion merger. During a conference call Tuesday, Sirius CEO Mel Karmazin said that XM and Sirius have yet to determine the new company’s name or headquarters location. The merged company will maintain a presence in D.C. that is “at least as significant” as its current foothold in the region regardless of where the headquarters are, XM spokesman Nathaniel Brown said. About 700 of XM’s employees are based in D.C.
“The D.C. facility is owned by XM and will be an important asset for the merged company,” Brown said Tuesday. Cowen & Co. Analyst Shaun Parvez predicted Tuesday that the headquarters will end up in New York, citing the fact that Karmazin will lead the new company, the presence of radio personality Howard Stern in the New York office, and that location’s proximity to the entertainment world. But Parvez noted that XM has more than just it’s corporate offices in Washington, D.C. is also the location of a studio and the firm’s network operations center, which runs its satellites.
“From a real estate standpoint, it seems likely both offices are likely to stay, at least in the near term,” Parvez said. The merger still needs to be approved by the Federal Communications Commission and the Department of Justice. Karmazin said the companies hope to merge by the end of this year.
Analysts predict that regulators will approve the merger because the market is very different today than it was almost a decade ago when they originally rejected the idea of one satellite radio company because competition from products like high-definition radio and iPods.
