Sirius discounts shares to pay for XM

Sirius plans to issue about 262 million shares, with about 184 million offered at a fixed price of $1.50 per share, compared with Monday’s closing price of $1.88 a share. The remaining 78 million are expected to be offered later. The company is paying $2.76 billion for XM. Sirius also said XM had earlier made a private offering of $550 million in notes, which will be exchangeable into Sirius shares.

The new company will be named Sirius XM Radio and will have more than 18.5 million subscribers, making it the second-largest radio business in the US after Clear Channel Communications. Sirius reiterated that as a result of the deal it expects to save about $400 million in 2009, and earn $300 million EBITDA.

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