Last Friday (Jan 6), Pandora’s shares dropped by more than 4% following the comments of a Sirius XM’s financial boss that a buyout was unlikely.
By Monday (Jan 9), the company’s total value had slipped by over $200m.
This news comes close to a month after the company’s COO resigned.
There has been a lot of talk about a Pandora buyout by Sirius since last year July after Sirius majority owner Liberty Media had offered to buy the music streaming service.
Liberty’s offer at the time was reportedly $15 per share – valuing Pandora at $3.4bn.
But last week’s comments by Sirius CFO David Frear changed things. He shrugged off the buyout intentions saying Sirius is looking for a certain number of things- a criteria that Pandora simply doesn’t meet.
Frear acknowledged whispers in the market over Sirius’s supposed intentions to buy Pandora – before shrugging them off.
The exec said that Sirius looks for signs of organic growth potential and strategic incentives in any prospective acquisition target. Pandora, he suggested, simply did not meet this criteria.
“With respect to all the chatter about [these] acquisitions, you have to look at them as them not being likely,” he said. “That’s the way to characterize it.”
In the first 9 months of 2016, Pandora reported net losses of over $250m, as active listeners dropped to 77.9m. The company is expected to launch a $9.99 paid plan to rival Spotify’s in this quarter.