Sirius XM Holdings Inc. has confirmed today (February 1) that is has completed its $3.5bn all-stock acquisition of Pandora Media.
Pandora Media Inc. (also known as Pandora Internet Radio or simply Pandora) is a music streaming and automated music recommendation internet radio service powered by the Music Genome Project. As of August 1, 2017, the service, operated by Pandora Media, Inc., is available only in the United States. The service plays songs that have similar musical traits. The user then provides positive or negative feedback (as thumbs up or thumbs down) for songs chosen by the service, and the feedback is taken into account in the subsequent selection of other songs to play. The service can be accessed either through a web browser or with its mobile app. Pandora is a freemium service; basic features are free with advertisements or limitations, while additional features, such as improved streaming quality, music downloads, and offline channels are offered via paid subscriptions.
On September 24, 2018, Sirius XM Holdings announced its intent to acquire Pandora for $3.5 billion. The purchase was greenlit by the Department of Justice on December 27th.
With the transaction complete, SiriusXM says it is now “the world’s largest audio entertainment company” with “strong, long-term growth opportunities”.
Jim Meyer, Chief Executive Officer of SiriusXM – which is majority owned by Liberty Media – said, “This is a tremendous outcome for two organizations with complementary platforms and large audiences, and we could not be more excited to be moving forward as one company. With SiriusXM’s subscription-based national service of curated and exclusive content and programming, and Pandora, the largest U.S. streaming music provider with its highly personalized free ad-supported service, under one roof, SiriusXM now reaches more than 100 million people across its audio products. That is a powerful platform for consumers, content creators and advertisers.”
“WITH SIRIUSXM’S SUBSCRIPTION-BASED NATIONAL SERVICE OF CURATED AND EXCLUSIVE CONTENT AND PROGRAMMING, AND PANDORA, THE LARGEST U.S. STREAMING MUSIC PROVIDER WITH ITS HIGHLY PERSONALIZED FREE AD-SUPPORTED SERVICE, UNDER ONE ROOF, SIRIUSXM NOW REACHES MORE THAN 100 MILLION PEOPLE ACROSS ITS AUDIO PRODUCTS.”
JIM MEYER, SIRIUSXM
Meyer continued, “Importantly, the premier products that SiriusXM and Pandora listeners have enjoyed for years are not changing. That said, good things come from being together, and we look forward to creating new unique audio packages that combine our strengths and offer an even wider range of content to our listeners.
“On behalf of everyone at SiriusXM, we are excited to officially welcome the talented Pandora team and look forward to working with all of our employees to continue delivering the best audio entertainment experience in the world and creating enhanced value for stockholders.”
Sirius says that the merged companies will capitalize on cross-promotion opportunities across more than 100 million combined listeners in North America.
Between them, SiriusXM and Pandora boast close to 40 million self-paying subscribers, and 75 million trialers and ad-based listeners, which, says Sirius, represents the largest digital audio entertainment audience in the U.S.
Meyer revealed earlier this week that the first cross-Sirius/Pandora offer to consumers will begin this month.
“In early February, we will begin a targeted promotion to SiriusXM subscribers and Pandora listeners,” he told investors. “Select Pandora listeners will receive an offer to obtain a unique $5-a-month Mostly News, Mostly Music or News Talk [Sirius subscription] package in their satellite-equipped vehicle… SiriusXM subscribers will also receive an extended 14-day trial to Pandora Premium.”
The outstanding shares in Pandora not already owned by SiriusXM will be exchanged for a fixed ratio of 1.44 newly issued SiriusXM shares.
The tenure of Pandora CEO Roger Lynch is now at an end, with Meyer taking over management of the music streaming service. Shares of Pandora’s common stock are no longer trading on the New York Stock Exchange.