Pandora may be singing ‘Shop Around’
OAKLAND, Calif. — Swing by the headquarters of internet radio company Pandora Media these days, and you might hear the executives singing the Smokey Robinson and the Miracles classic “Shop Around.”
Because what’s being shopped around might be Pandora itself.
Pandora reportedly spoke with Apple and Amazon about a possible acquisition earlier this year, and also entertained a $3.4 billion offer from Liberty Media, according to a report in The Wall Street Journal.
Citing “people familiar with the matter,” the Journal said that Liberty CEO Greg Maffei made the bid as part of a “fishing expedition” about somehow tying up Pandora with satellite-radio company Sirius XM Holdings, which Liberty controls.
Maffei reportedly offered Pandora $15 a share, but the company’s board turned down the proposal because it believed Pandora is worth closer to $20 a share, which is where the company’s stock traded last fall.
Pandora didn’t return respond to requests for comment.
Total listeners
Pandora shares rose 2.3 percent to close Friday at $12.28, one day after the company reported its second-quarter results. For the period ended June 30, Pandora said it lost $76.3 million, or 33 cents a share, on $343 million, compared to a loss of $16 million, or 8 cents a share, on $285.6 million in the same quarter a year ago. Total listener hours rose to 5.7 billion from 5.3 billion a year ago, but active listeners declined to 78.1 million from 79.4 million in last year’s second quarter.
Pandora also forecast third-quarter sales between $360 million and $370 million, which fell below analysts’ estimates of $378 million.
Earlier this year, Pandora laid out plans to launch an on-demand streaming service that would be similar to that of rivals like Spotify, and the company set a target of reaching $4 billion in annual revenue by 2020. Along with its secondquarter results, Pandora said it had signed up more than two dozen independent labels for its upcoming streaming service.
‘A mixed bag’
Benjamin Swinburne, who covers Pandora for Morgan Stanley, called the company’s results “a mixed bag,” but he said the deals with the independent labels “protect Pandora’s economics both in a new interactive environment as well as its core radio business.”
It’s been a year of unconfirmed reports, executive changes, dissatisfied investors and uncertainty at the internet radio pioneer.
Earlier this year, Pandora was said to have hired investment bankers to explore a possible sale of the company. In March, Pandora replaced CEO Brian McAndrews with company co-founder Tim Westergren, who said that he believed the company’s best course was to remain independent.
Then, in March, Corvex Management disclosed it had acquired a 9.9 percent stake in Pandora, and called upon Westergren and Pandora to explore a sale of the company.