5/7/03:: Wal-Mart Sells Delphi, XM Satellite Radio

Wal-Mart Sells Delphi, XM Satellite Radio

May 7, 2003 -- New York - Automotive parts maker Delphi Corp. and XM Satellite Radio Holdings Inc. on Tuesday said No.1 retailer Wal-Mart Stores Inc. will sell Delphi and XM's line of portable satellite receivers, an agreement which lifted XM stock by more than 15 percent. Wal-Mart will sell the Delphi XM SKYFi system, which features a pocket-sized portable device that allows listeners to tune into the broadcaster's service using a home stereo or as part of a portable "boombox."
Introduced in September, the radio receiver sells for around $130, and a kit that connects it to a home or car stereo goes for about $70.

The system gives users attracted to satellite radio, with its diverse selection of music, talk and news channels -- many of which are broadcast free from advertisements -- the chance to listen to the system when not in a car. XM radios typically are installed in autos either at the factory or local dealers.

Shares of XM rose more than 15 percent on the news, to $11.63, its highest level since May 2002. In morning dealings, the stock traded at $11.17, up $1.47, on volume of 7.8 million, already greater than its daily average.

Rival satellite radio provider Sirius Satellite Radio Inc. also gained on Nasdaq, with its stock up 20 percent, or 18 cents at $1.08. Its volume topped 46 million, making its the most active issue on Nasdaq.

Both companies are looking for catalyst to growth of the entire satellite radio market, with each struggling to remain viable, and losing money as they try to attract subscribers.

In April, XM said it had signed up more than 500,000 subscribers to its satellite radio broadcast system, fueled by demand for new products, and has pledged to reach 1 million during 2003.

Sirius, which launched its service a year after XM has said it ended 2002 with just short of 30,000 users. It hopes to reach 300,000 by the end of 2003.

-Reuters