- Getty Images/Larry Busacca
Internet-radio pioneer Pandora saw its stock soar Friday after a report from CNBC said the company was open to selling itself.
Pandora was up over 16% at one point in trading on Friday.
Friday morning, CNBC reported that Pandora was “open to engaging in talks with longtime suitor SiriusXM,” citing sources.
Later Friday, Bloomberg reported that Pandora had been approached by Sirius XM’s chairman Greg Maffei to express an interest in buying the company. Sirius XM had reportedly made an informal offer to buy Pandora earlier this year for $15 per share (Pandora is currently trading at around $13 per share). That offer valued the company at over $3.4 billion, according to the Wall Street Journal.
A Bloomberg source said Pandora hadn’t yet responded to Sirius XM, but another said Pandora’s advisers had started reaching out to other potential buyers.
Pandora is a company in transition, on the brink of launching an on-demand product to compete with the likes of Spotify and Apple Music. That product is scheduled to arrive on December 6.
Pandora has endured on-and-off rumors that it is for sale, but many took the installing of founder Tim Westergren in the CEO spot, in March, as a sign that the company was not actively looking to sell itself. But some have wanted Pandora to sell for awhile. There has been pressure, particularly from Pandora’s activist shareholder, Corvex, for the company to consider a sale.
In September, SunTrust analysts led by Robert S. Peck explored who the potential buyers for Pandora would be. Here’s what they came up with at the time:
Liberty Media/SiriusXM: “Liberty’s CEO has been reported by CNBC to have acknowledged the benefits of a P/Sirius merger and was reported by the Wall Street Journal to have made an informal $15 offer for P. Liberty Media is 65% owner of Sirius XM. Further, P’s activist shareholder has publicly endorsed a tie-up between P and Liberty/SiriusXM.”Spotify: “A potential merger of Spotify and Pandora has also been discussed in the press, including Forbes. We believe synergies would be substantial as it relates to product development, marketing, salesforce, content delivery, royalty tracking/reporting, back office, demographics, data, local, in-auto, upsell, and programmatic. A reverse merger could provide Spotify an alternative to an IPO and a liquidity event for its investors.”Others: “The suitors that make most sense to us are mobile-first and acquisitive with an ad business and amenable to an inside plus feet-on-the-street salesforce model. We believe this includes Verizon and to a lesser extent AT&T.”