Mergers and Acquistions News
Categories: Media & Information Services
November 25th 2010, 18:26PM
The parent company of two Canadian radio broadcasters is bringing the firms together in an approximate C$520 million (£327 million) merger.
Canadian Satellite Radio Holdings will merge XM Canada and Sirius Canada into a single entity, and will also assume long-term debt of about C$130 million.
It will enable satellite radio to better compete in what is a rapidly changing industry, offering customers a broader range of content and commercial-free music.
On completion of the merger, the combined company will serve over 1.7 million listeners via subscriptions and is expected to have pro forma revenues beyond C$200 million, with pro forma EBITDA of approximately C$7 million.
The firm said it expects to "yield synergies" of approximately C$20 million within 18 months by enabling the new company to improve efficiency.
Calling the deal the "next logical step in the evolution of satellite radio in Canada", Mark Redmond, president and chief executive officer of Sirius Canada, said the combination will mean satellite radio will be better equipped to compete.
"The benefits of a merger are clear and together we'll be better able to create more growth and opportunity for shareholders, accelerate technological innovation and ensure that satellite radio is able to compete in the rapidly evolving audio entertainment industry," he said.
In the fiscal year ending August 31st 2010, XM Canada announced revenues of C$56.6 million, up from C$52.5 million in the previous year.
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