Only U.S. satellite radio operator Acquisition of XM Satellite Radio in 2008 is providing operating synergies and cost-saving opportunities Increased number of automotive models under exclusive contracts for factory-installation of satellite radios Ongoing conversion of roughly 44% of automaker promotional subscribers to paid subscribers Modestly increasing subscriber churn Short track record of positive EBITDA and discretionary cash flow Substantial debt balances Dependence on anemic U.S. automotive sales for growth Sizable debt maturities from 2011-2013 Sirius XM Radio Inc.'s rating reflects its substantial debt load, dependence on slumping U.S. automotive sales, and modest--albeit increasing--EBITDA and discretionary cash. The operating synergies and cost savings arising from the 2008 XM Satellite Radio Inc. acquisition are modest positives that do not offset these risks.
