Merger Worries Slap Sirius

Concerns about the XM (XMSR Quote)-Sirius (SIRI Quote) merger are mounting on Wall Street.

Judging by the steady slide in satellite-radio stocks since the two companies announced their big tie-up three months ago, it seems investors are growing less confident that the proposed union of the two pay-radio shops will survive regulatory scrutiny.

XM and Sirius shares are both down 30% since the deal was announced in February. The shareholder anxiety has helped trim the value of the deal to $3.8 billion from as high as $5.5 billion in the early post-announcement euphoria.

Wall Street seems to be taking its cue from leading legal experts in Washington, D.C. They agree that the most formidable challenge to the merger will come from the Justice Department's antitrust review. ...