Shares of Pandora Media (NYSE: P) are up by double-digit percentages on a report that the company has indicated a willingness to be bought out. CNBC, citing “people familiar with the matter,” says that Pandora is now open to the possibility in general, and to selling itself to former suitor Sirius XM Holdings (NASDAQ: SIRI) in particular.
Neither Pandora nor Sirius XM Holdings has yet commented on this speculation, but it would represent an about-face for the target company.
Over the years, Pandora had steadfastly refused to be acquired by larger media companies. The latest approach was reportedly made by Sirius XM Holdings’ majority owner, Liberty Media, which according to an article in The Wall Street Journal informally offered $15 per share earlier this year. Such a deal would have valued Pandora at more than $3.4 billion.
Friday’s CNBC report claims that a group of three major Pandora shareholders — Corvex Management, Matrix Capital Management, and Eminence Capial — have unified in their belief that a sale would be beneficial. Together, the trio held nearly 20% of Pandora’s outstanding shares as of the end of September. This past May, Corvex urged Pandora management to consider a sale, instead of following what it characterized as a “costly and uncertain business plan.”
One of CNBC’s sources said that Pandora’s indication of interest in a deal is only the start of what could be a route to an eventual sale. It is not certain at this stage whether such a deal will occur, whether with Sirius XM Holdings or any other party, the source said.
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