iHeartMedia CEO Bob Pittman has said from day one that music curation is more of an audio feature than a profitable business. And, Pandora appears to be heading in that direction if the recent reports are true and the company becomes part of SiriusXM or sold off to some other company. We should find out soon enough.
There have been rumors for months that Pandora and SiriusXM were in negotiations for SirisXM to purchase the pure-play streamer. More recently, Pandora was ready to take an investment from private equity firm KKR unless it could find a buyer for the company in 30 days.
On Thursday, the 30-day deadline, Pandora announced it would be extending that 30 day time-frame to explore a “substantial minority investment.” That’s believed to be SiriusXM, although Pandora was not specific. According to Bloomberg the deal is done and both sides have agreed on valuation. If true, it’s unknown as of yet if KKR’s $150 million is off the table. Reuters is reporting that Sirius is negotiating a private investment in public equity after talks about Sirius buying Pandora outright ended unsuccessfully over price disagreements.
Still very popular, Pandora continues to lose money and is facing a crowded field with iHeart, Spotify, Apple and Amazon being just the major players in that space.
Here’s is Pandora’s complete statement from Thursday: “Although all conditions to closing of the investment by KKR in Pandora (NYSE: P) have been met and both parties are prepared to close immediately, KKR and Pandora agreed to a brief extension of the pre-closing period and Pandora’s termination right to enable Pandora to explore interest expressed by a strategic investor in making a substantial minority investment in Pandora, in lieu of the KKR investment. If Pandora determines that the KKR investment continues to be in the best interest of its stockholders, the KKR investment will close immediately following the expiration of this extended period.”