XM Satellite Radio Holdings Inc. and Sirius Satellite Radio Inc., rivals in the fledgling satellite radio industry, have agreed to combine in a deal that investors hope will result in lower costs, assuming it overcomes significant regulatory hurdles.

The companies billed the deal announced Monday as a merger of equals, with shareholders of both companies owning approximately 50% of the combined entity. However, Sirius will be giving $4.57 billion of its stock to XM shareholders, a substantial premium to the value of their shares. Sirius’ Chief Executive Mel Karmazin will lead the combined company, and XM’s CEO Hugh Panero will stay on only until the deal is closed. XM Chairman Gary Parsons will remain in that role.

XM radio receivers can’t receive signals from Sirius, and vice versa. But Karmazin and Parsons said in an interview that the companies are working on developing a receiver that could receive both signals. In the meantime, they said, assuming the deal goes through, the companies would make other arrangements to bring programming that’s currently exclusive to one provider to listeners of the other, such as getting Major League Baseball games currently only available on XM to Sirius listeners.

MSNBC