FCC chief says rule bars satellite radio merger

The Federal Communications Commission said licenses held by XM Satellite Radio Holdings Inc. and Sirius Satellite Radio Inc. would prevent them from combining, but one industry expert said they could ask for the licenses to be modified.

“There’s a prohibition on one entity owning both of those licenses,” FCC Chairman Kevin J. Martin said. However, Martin also said the FCC would examine any transaction submitted to it.

Wall Street analysts have speculated about a possible combination of the two providers, and their stocks have risen sharply in recent weeks.