Pandora got desperate enough that it lost $250 million on Ticketfly
Pandora has been trying to find the right buyer for over a year, with no luck.
Desperate times call for desperate measures. The music-streaming service has agreed to a $480 million investment from SiriusXM. In doing so, it’s taking a $250 million loss on Ticketfly, which Pandora bought just 18 months ago.
Pandora rejected an offer from SiriusXM to buy the struggling online radio service outright, CNBC reported. Pandora had said no to earlier offers because the company felt they didn’t value the company high enough. Instead, Pandora will get $480 million through a strategic cash investment. SiriusXM gets to choose three new members of Pandora’s board of directors and a new chairman.
“This strategic investment in Pandora represents a unique opportunity for SiriusXM to create value for its stockholders by investing in the leader in the ad-supported digital radio business, a space where SiriusXM does not play today,” SiriusXM CEO Jim Meyer said in a statement. “Pandora’s large user base and its ability to provide listeners with a personalized music experience are tremendous assets.”
Probably as a condition of this deal, Pandora had to sell Ticketfly. The ticketing service went to Eventbrite for $200 million—much less than the $450 million Pandora paid for it in 2015. As part of the sale, Pandora will enter a “commercial agreement” with Eventbrite to still allow Pandora to be involved in ticketing in some as-yet-unspecified way.
“Pandora is now poised to advance to the next stage of the company’s lifecycle,” Pandora Director Tim Leiweke said in a statement. “We are pleased that the conclusion of our strategic review resulted in a major investment by a world class company like SiriusXM, and with the sale of Ticketfly, we will now redouble our focus on execution supported by a strong balance sheet.”
Pandora is facing competition from more and more music streaming options—Apple Music, Spotify, Amazon Music Unlimited, etc.
Pandora introduced its own long-awaited on-demand streaming service — aka not just free internet radio — in March.
Good luck, Pandora, in the next stage of your lifecycle.