UPDATE 2-Satellite radios XM, Sirius Canada to merge

* Merged firm to have enterprise value of $520 mln

* CSR chairman John Bitove to have 30 pct voting rights

* Shares up 15 pct
(Adds details)

TORONTO, Nov 24 (BestGrowthStock) – Canadian Satellite Radio
Holdings Inc (XSR.TO: ) said on Wednesday it is merging XM Canada
and Sirius Canada in a deal that will bring together the
Canadian licensees of the Sirius and XM satellite radio
platforms two years after the U.S. broadcasters merged.

The C$520 million all-stock deal includes about C$130
million in long-term debt. Once completed, it will see U.S.
based Sirius XM Radio Inc (SIRI.O: ) with a 37.1 percent equity
stake in the new company.

After the merger, CSR’s Chairman John Bitove will see his
voting interest in the company more than halved to 30 percent,
the company said.

Sirius XM Radio Inc (SIRI.O: ), the Canadian Broadcasting
Corp and Slaight Communications would be other major
shareholders in the new company, which will have a subscriber
base of 1.7 million.

The combined company said it expects to be able to cut
costs by C$20 million within 18 months, even as it pursues
growth in the Canadian audio-entertainment market.

On a trailing 12-month basis, the combined company will
have pro forma revenues in excess of C$200 million, EBITDA of
approximately C$7 million, and long-term debt of approximately
C$130 million, CSR said.

“In the current economic environment and with increasing
pressures on technology and innovation, we need to build a firm
that is well-resourced to compete, and both companies realized
that we would become stronger as a result of this merger,”
Bitove said on a conference call with analysts.

The transaction is subject to approval by CSR shareholders
at a special meeting to be held in February.

CSR shares rose as much as 15 percent to a 52-week high of
C$3.76 on Wednesday afternoon on the Toronto Stock Exchange.
(Reporting by Supantha Mukherjee in Bangalore; Additional
reporting by Pav Jordan in Toronto)

UPDATE 2-Satellite radios XM, Sirius Canada to merge