Satellite Radio giant SiriusXM will acquire the Oakland, Calif.-based digital radio company Pandora for an estimated 3.5 billion dollars.
The reports of this deal say it will be an all stock purchase. The merger would create “the world’s largest audio entertainment company,” SiriusXM CEO James Meyer said in a conference call. The deal would still need to be reviewed by antitrust regulators and shareholders, he added.
The deal is not a major secret, in fact many in the music industry and multi-media have expected this announcement for the last several months. SiriusXM invested 450 million dollars in to Pandora, that move allowed SiriusXM to place three top executives on the Pandora board. One of which would serve as the CEO.
The 450 million dollar investment was quickly followed by Pandora co-founder and CEO Tim Westergren stepping down from the company.
SiriusXM CEO James Meyer said he has been in talks with Pandora for several years.
“We had a conversation 15 months ago and couldn’t reach an agreement on value, quite honestly … when we took that position, I assure you, there was no guarantee that any further transaction would get done or that we would end up where we’ve ended up today. What’s changed is my confidence in Pandora as an asset, and that confidence is a result of the progress I’ve seen in the last 12 months.”
If the deal is approved by the antitrust regulators and shareholders, SiriusXM programming could see a major overhaul in it’s online content and streaming services as well as new programming on their satellite accounts. The merger would also bring an expected 70 million pandora users to SiriusXm which currently has 36 million users world-wide.