Okay, so now it looks as if hell has officially frozen over, with two big industry transactions taking place within days of each other. And it looks like the book has been closed on each of those chapters, so I can actually make mention of them without being teased yet again by the boy who cried wolf.
First, after a year and a half of dickering around, and less than a week after the FCC finally threw their hands in the air, the Sirius/XM merger is now in the books. Yes, officially. The company will now be called Sirius XM Radio Inc. (traded on NASDAQ via the SIRI symbol, for those of you who keep track of that sort of thing). NOt a whole lot else is known yet, except for the fact that the combined company will be led by Sirius CEO Mel Karmazin, with XM Chairman Gary Parsons serving as chairman of the new company.
Sirius XM will be headquartered in New York, where Sirius is based. XM Satellite will now be a wholly-owned subsidiary of Sirius and will keep its Washington broadcasting headquarters.
Existing customers of either service will be able to retain their current service and existing radio receivers will continue to work, Sirius XM claims. Subscribers will also now have the option to pick from different packages of channels, known as a la carte programming.
Of course, what those programming choices will consist of has yet to be determined, though some suggestions have been made here.
In the other big broadcasting deal, Clear Channel stockholders have finally agreed, based on a preliminary vote, to go forward with the sale of the company to a private equity group led by Bain Capital Partners LLC and Thomas H. Lee Partners LP. Clear Channel initially entered into the merger agreement with the Bain/Lee group in November 2006. The parties now expect to consummate the deal on July 30. The new group will be known as CC Media Holdings Inc.
Nothing is known about the new company's plans, but if other venture capital investments are any clue, it will be mostly downsizing-related, to minimize expenditures and maximize profits. The concept of actually beefing up product rather than slashing it to pieces is often lost on these people.
Tuesday, July 29, 2008
Clash (and consolidation) of the titans
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Eureka, CA 
4 comments:
Bain Capital Partners LLC is Mitt Romney's company, and you're completely correct on their management style. Plus you have to question having a potential Vice Presidental candidate owning such a larch chunk of the media landscape, no?
Mitt Romney doesn't "own" Bain Capital. He left it years ago.
> The concept of actually beefing up
> product rather than slashing it to
> pieces is often lost on these
> people.
Amen to that. One wonders whether it's possible for the new Clear Channel to downsize and cut expenses more than they already have; that's been the name of their game for years. But this will concentrate ownership (and dividends) in far fewer hands (although not Mitt Romney's).
Recipe for failure: Taking two failing companies and combine them. Has this ever worked? But Wall Street types keep trying? Why? Because investment bankers make out like bandits, even if shareholders get screwed and the new company fails anyway.
What NYLefty said. Romney helped found the company, but he left years ago. He may still own a small interest, but certainly not enough to have any power.
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