Pandora buys time via on-demand service

Pandora on Monday launched a new $10 monthly on-demand product, “Pandora Premium,” that will compete with Spotify and Apple Music, among others.

The effort is buying CEO Tim Westergren time before big shareholders demand he put Pandora up for sale.

Westergren, the company founder, said Monday that the company is not for sale. Pandora lost $343 million last year.

“Everyone still wants them to sell, but only once they show a bit of traction,” said one stockholder. “Tim has done everything possible since he became CEO. He got label deals done quickly, changed [the] CFO, laid off 7 percent of the staff and realized he shouldn’t compete with Facebook and Google on ad revenue — that he should be competing with radio.”

Naysayers believe Pandora has little chance of success against big tech giants, and shareholders such as Corvex have agitated for a sale.

Pandora is set to upgrade its $4.99per-month “Pandora Plus” customers to the new $9.99-per-month on-demand service for free for six months. The new tier offers consumers off-line listening and the ability to select songs.

In recent weeks, Liberty Media has been talking down the stock, after making a $15-per-share offer last year. Liberty Media would like to pair Pandora’s technology with its own SiriusXM product, but at the right price.

Liberty Media CEO Greg Maffei cheekily said last week he’d be will- ing to buy the firm at $10. The stock closed up 2 percent in the Monday session, at $12.38.

Corvex has signed a nondisclosure agreement so it could gain confidential information on Pandora, two sources said. That agreement will likely prevent Corvex from launching a proxy fight that could have resulted in voting Westergen off the board.

Pandora’s deadline for board nominations expires March 17.

Corvex did not return multiple calls.