Under the agreement, XM and WorldSpace will work together to develop new offerings, technology, and distribution and supplier networks. XM can also acquire additional WorldSpace stocks worth $3.75 million and has the option of investing in future projects in other countries.
WorldSpace, which was one of the principal founding shareholders of XM, has recently filed for an initial public offering of its stock. The company raised the expected price of its planned initial public offering on Tuesday to $18 to $20 per share, from $16 to $18.
WorldSpace in 1999 sold its interest in XM, which is licensed to use and develop WorldSpace's technology, according to the filing.
WorldSpace broadcasts subscription-based news, music and educational programs in markets such as Europe, Africa, Asia and the Middle East using its own satellites--AfriStar and AsiaStar. It also owns spectrum licenses in various countries to deliver audio as well as multimedia content.
Earlier this month, XM announced a stock deal worth $198 million to acquire privately held WCS Wireless. The WCS deal lets XM, which has, have access to more wireless spectrum licenses, particularly in frequency bands adjacent to those used by its own satellite radio service.
Reuters contributed to this story.