Exactly one month after Pandora secured a highly conditional financial lifeline, the company has secured a sizable investment from satellite radio leader SiriusXM, which has had its eyes on the digital radio pioneer for some time.
The deal, worth $480 million, sees SiriusXM hoovering up 19 percent of Pandora's outstanding common stock. SiriusXM will also appoint three to Pandora's board of directors, one of whom will serve as its chairperson.
An email from SiriusXM CEO Jim Meyer, provided to NPR, focuses on Pandora's robust advertising division and characterizes the deal as "compelling for SiriusXM as it represents a unique opportunity for us to create value for our stockholders by investing in a leader in the streaming radio market." Meyer stresses that the investment is not "a merger or business combination," but a "smart financial decision." Indeed — why invest in a company whose listener numbers have shrunk year-over-year and was so dramatically seeking new investments? Sell low, buy high; Pandora's stock has been steadily sinking over this year, and this new investment is driving it up.
Pandora and SiriusXM are a natural fit — each plays in similar spaces with little practical overlap — but both parties stress this is just an investment (for now). "Business as usual," according to Meyer.
In other news, Pandora is selling Ticketfly, the ticketing platform it bought for $450 million just under two years ago, to Eventbrite for $200 million.
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