I think I missed something. Exactly when did the United States become a communist nation?
The proposed merger between Sirius Satellite Radio (SIRI) and XM Satellite Radio (XMSR) has been stuck in regulatory purgatory for two years now that can only be compared to the nonsense of a communist-based system!
I honestly cannot believe that more people are not up in arms about this blatant misuse of power! The amount of time to make a fairly simple decision defies belief and brings into question the very principles this country was found upon.
The lengthy review makes no sense at all despite the supposed complexity of the deal and other lame reasons thrown out by the government. Frankly, I would contend the delay is criminal.
Who do we turn to when our government has failed us?
I can appreciate the fact that we have more pressing issues to be concerned about, but honestly the lack of attention given to this matter by the press or the public in general is surprising.
Make no mistake; this delay has caused real damage for both companies and its shareholders. Stuck in a state of flux both SIRI and XMSR have essentially operated in the dark.
Without approval, both companies must behave as if the deal will fail. At the same time, they must expend energy and resources preparing for a future should the deal be approved.
Such a state could not have happened at worse time. With the economy in shambles, selling a premium product that depends on discretionary spending is a recipe for disaster. Frankly, I am surprised SIRI and XMSR have done as well as they have done given the circumstance!
In its most recent earnings report, SIRI announced that …> subscriptions had grown by 30% on a year over year basis. With 8.64 million subscribers SIRI posted a narrower loss in the quarter of $.07.
While 30% growth is nothing to sneeze at, the number falls way short of the growth percentage that it had been generating prior to the merger announcement. The problem for SIRI is that with all of the attention on the merger and the wait for approval, the company pulled in the reins on marketing.
The economy may be a big drag for the company, but so too is this delay. Honestly, at this point, I really don’t care if the deal is approved or not. The distraction has hurt shareholders period.
Sirius won this battle a few years ago, by securing the premier content needed to draw a wide audience of subscribers. A deal with XMSR would no doubt be beneficial for the company, but they can go it alone if need be. The FCC needs to get their heads out of the clouds. The agency may play a role in the chaos that is the airwaves, but in this case they are clearly overstepping. Approve the deal and let’s all move on. Every quarter that passes by hurts both shareholders and consumers alike.
The silver lining may be that when the deal is approved shares should see a substantial boost. An aggressive, risk taking investor may look to profit in the short term with options on SIRI. Buying out-of-the-money call contracts like on a monthly basis like Ken Trester of Fast Options Profits, makes Rational sense to me.
If the government gets out of the way, this deal should get approved in short order, and those lucky few who own call options stand to gain nicely if the stock takes off. For other technology plays in the options market, I recommend checking out Ken Trester and his Fast Options Profits service. New subscribers can sign up for a risk-free 3-month trial subscription back by a 100% money-back guarantee.
I haven’t lost entire faith in capitalism and neither has Ken Trester!
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