NEW YORK and OAKLAND, Calif., Sept.
24, 2018 /PRNewswire/ -- Sirius XM
Holdings Inc. (NASDAQ: SIRI) and Pandora Media, Inc. (NYSE: P)
today announced a definitive agreement under which SiriusXM will
acquire Pandora in an all-stock transaction valued at approximately
$3.5 billion. The combination creates
the world's largest audio entertainment company, with more than
$7 billion in expected pro-forma
revenue in 2018 and strong, long-term growth opportunities.
This strategic transaction builds on SiriusXM's position as the
leader in subscription radio and a critically-acclaimed curator of
exclusive audio programming with the addition of the largest U.S.
audio streaming platform. Pandora's powerful music platform will
enable SiriusXM to significantly expand its presence beyond
vehicles into the home and other mobile areas. Following the
completion of the transaction, there will be no immediate change in
listener offerings.
The combined company will drive long-term growth by:
- Capitalizing on cross-promotion opportunities between
SiriusXM's base of more than 36 million subscribers across
North America and 23 million-plus
annual trial listeners and Pandora's more than 70 million monthly
active users, which represents the largest digital audio audience
in the U.S.
- Leveraging SiriusXM's exclusive content and programming with
Pandora's ad-supported and subscription tiers to create unique
audio packages, while also utilizing SiriusXM's extensive
automotive relationships to drive Pandora's in-car
distribution.
- Continuing investments in content, technology, innovation, and
expanded monetization opportunities through both ad-supported and
subscription services in and out of the vehicle.
- Supporting and strengthening Pandora's highly relevant
brand.
- Creating a promotional platform for emerging and established
artists, curated and personalized in ways to deliver the most
compelling audio experience that connects artists to their fan
bases, as well as new listeners.
Jim Meyer, Chief Executive
Officer of SiriusXM, said, "We have long respected Pandora and
their team for their popular consumer offering that has attracted a
massive audience, and have been impressed by Pandora's strategic
progress and stronger execution. We believe there are significant
opportunities to create value for both companies' stockholders by
combining our complementary businesses. The addition of Pandora
diversifies SiriusXM's revenue streams with the U.S.'s largest
ad-supported audio offering, broadens our technical capabilities,
and represents an exciting next step in our efforts to expand our
reach out of the car even further. Through targeted investments, we
see significant opportunities to drive innovation that will
accelerate growth beyond what would be available to the separate
companies, and does so in a way that also benefits consumers,
artists, and the broader content communities. Together, we will
deliver even more of the best content on radio to our passionate
and loyal listeners, and attract new listeners, across our two
platforms."
Roger Lynch, Chief Executive
Officer of Pandora, said, "We've made tremendous progress in our
efforts to lead in digital audio. Together with SiriusXM, we're
even better positioned to take advantage of the huge opportunities
we see in audio entertainment, including growing our advertising
business and expanding our subscription offerings. The powerful
combination of SiriusXM's content, position in the car, and premium
subscription products, along with the biggest audio streaming
service in the U.S., will create the world's largest audio
entertainment company. This transaction will deliver significant
value to our stockholders and will allow them to participate in
upside, given SiriusXM's strong brand, financial resources and
track record delivering results."
Transaction Details
Pursuant to the agreement, the owners of the outstanding shares
in Pandora that SiriusXM does not currently own will receive a
fixed exchange ratio of 1.44 newly issued SiriusXM shares for each
share of Pandora they hold. Based on the 30-day volume-weighted
average price of $7.04 per share of
SiriusXM common stock, the implied price of Pandora common stock is
$10.14 per share, representing a
premium of 13.8% over a 30-day volume-weighted average price. The
transaction is expected to be tax-free to Pandora stockholders.
SiriusXM currently owns convertible preferred stock in Pandora that
represents a stake of approximately 15% on an as-converted
basis.
The merger agreement provides for a "go-shop" provision under
which Pandora and its Board of Directors may actively solicit,
receive, evaluate and potentially enter negotiations with parties
that offer alternative proposals following the execution date of
the definitive agreement. There can be no assurance this process
will result in a superior proposal. Pandora does not intend to
disclose developments about this process unless and until its Board
of Directors has made a decision with respect to any potential
superior proposal.
Approvals
The transaction has been unanimously approved by both the
independent directors of Pandora and by the board of directors of
SiriusXM.
The transaction is expected to close in the first quarter of
2019. It is subject to approval by Pandora stockholders, expiration
or termination of any applicable waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act and certain
competition laws of foreign jurisdictions and other customary
closing conditions.
SiriusXM Reiterates Full Year 2018 Outlook
SiriusXM reiterated its full-year 2018 guidance provided on
July 25, 2018, with self-pay net
subscriber additions of approximately 1.15 million; revenue over
$5.7 billion; adjusted EBITDA of
approximately $2.175 billion, and
free cash flow of approximately $1.5
billion.
Pandora Reiterates Q3 2018 Guidance
Pandora reiterated its third quarter 2018 guidance provided on
July 31, 2018, with revenue of
$390 million to $405 million and Adjusted EBITDA of ($25) million to ($10)
million.
Conference Call Information
SiriusXM will hold a conference call to discuss this transaction
today, September 24, 2018 at
8:30 AM ET. The dial-in information
for participants is (866) 610-1072 (Domestic) and +1 (973) 935-2840
(International). The passcode for both numbers is 7138655.
Investors will have the opportunity to listen to the conference
call live and access the accompanying presentation slides on each
company's investor relations tabs on each company's website,
http://investor.siriusxm.com or http://investor.pandora.com.
Participants are encouraged to register at least 15 minutes
early to download and install any necessary software. For those who
cannot listen to the live broadcast, a telephonic replay will be
available through October 8, 2018 by
dialing (800) 585-8367 (Domestic) and +1 (404) 537-3406
(International), passcode 7138655. An archived version of the
replay will also be available at http://investor.siriusxm.com or
http://investor.pandora.com.
Advisors
Allen & Company LLC and BofA Merrill Lynch are serving as
financial advisors to SiriusXM and Baker Botts LLP and Simpson
Thacher & Bartlett LLP are serving as its legal counsel.
Centerview Partners LLC, LionTree Advisors LLC and Morgan
Stanley & Co. LLC are serving as financial advisors to Pandora
and Sidley Austin LLP is acting as legal counsel.
About SiriusXM
Sirius XM Holdings Inc. (NASDAQ: SIRI) is the world's largest
radio company measured by revenue and has approximately 33.5
million subscribers. SiriusXM creates and offers commercial-free
music; premier sports talk and live events; comedy; news; exclusive
talk and entertainment, and a wide-range of Latin music, sports and
talk programming. SiriusXM is available in vehicles from every
major car company and on smartphones and other connected devices as
well as online at siriusxm.com. SiriusXM radios and
accessories are available from retailers nationwide and online at
SiriusXM. SiriusXM also provides premium traffic, weather, data and
information services for subscribers through SiriusXM Traffic™,
SiriusXM Travel Link, NavTraffic®, NavWeather™. SiriusXM delivers
weather, data and information services to aircraft and boats
through SiriusXM Aviation™ and SiriusXM Marine™. In addition,
SiriusXM Music for Business provides commercial-free music to a
variety of businesses. SiriusXM holds a minority interest in
SiriusXM Canada which has approximately 2.6 million subscribers.
SiriusXM is also a leading provider of connected vehicles services,
giving customers access to a suite of safety, security, and
convenience services including automatic crash notification, stolen
vehicle recovery assistance, enhanced roadside assistance and
turn-by-turn navigation.
About Pandora
Pandora is the world's most powerful music discovery platform—a
place where artists find their fans and listeners find music they
love. We are driven by a single purpose: unleashing the infinite
power of music by connecting artists and fans, whether through
earbuds, car speakers, or anywhere fans want to experience it.
Pandora's team of highly trained musicologists analyze hundreds of
attributes for each recording which powers our proprietary Music
Genome Project®, delivering billions of hours of personalized music
tailored to the tastes of each music listener, full of discovery,
making artist/fan connections at unprecedented scale. Founded by
musicians, Pandora empowers artists with valuable data and tools to
help grow their careers and connect with their fans.
www.pandora.com | @pandoramusic | www.pandoraforbrands.com |
@PandoraBrands | amp.pandora.com
Contact for SiriusXM:
Investors:
Hooper Stevens
212-901-6718
hooper.stevens@siriusxm.com
Media:
Patrick Reilly
212-901-6646
patrick.reilly@siriusxm.com
Contact for Pandora:
Investors:
Derrick Nueman
510-842-6960
investor@pandora.com
Media:
John Franklin
646-706-1691
john@sintercompany.com
IMPORTANT ADDITIONAL INFORMATION AND WHERE TO FIND IT
This communication is being made in respect of the proposed
merger transaction involving Sirius XM Holdings Inc. ("Sirius") and
Pandora Media, Inc. ("Pandora"). Sirius intends to file a
registration statement on Form S-4 with the SEC, which will include
a proxy statement of Pandora and a prospectus of Sirius and each
party will file other documents regarding the proposed transaction
with the SEC. Any definitive proxy statement(s)/prospectus(es) will
also be sent to the stockholders of Pandora seeking any required
stockholder approval. This communication does not constitute an
offer to sell or the solicitation of an offer to buy any securities
or a solicitation of any vote or approval. Before making any
voting or investment decision, investors and stockholders of
Pandora are urged to carefully read the entire registration
statement and proxy statement/prospectus, when they become
available, and any other relevant documents filed with the SEC, as
well as any amendments or supplements to these documents, because
they will contain important information about the proposed
transaction. The documents filed by Sirius and Pandora with the
SEC may be obtained free of charge at the SEC's website at
www.sec.gov. In addition, the documents filed by Sirius may be
obtained free of charge from Sirius at www.siriusxm.com, and the
documents filed by Pandora may be obtained free of charge from
Pandora at www.Pandora.com. Alternatively, these documents, when
available, can be obtained free of charge from Sirius upon written
request to Sirius,1290 Avenue of the Americas, 11th
Floor, New York, New York 10104,
Attn: Investor Relations, or by calling (212) 584-5100, or from
Pandora upon written request to Pandora, 2101 Webster Street, Suite
1650, Oakland, California 94612
Attn: Investor Relations or by calling (510) 451-4100.
Sirius and Pandora and certain of their respective directors and
executive officers may be deemed to be participants in the
solicitation of proxies from the stockholders of Pandora in favor
of the approval of the merger. Information regarding Sirius'
directors and executive officers is contained in Sirius' Annual
Report on Form 10-K for the year ended December 31, 2017, its Quarterly Reports on Form
10-Q for the quarterly periods ended March
31, 2018 and June 30, 2018 and
its Proxy Statement on Schedule 14A, dated April 23, 2018, which are filed with the SEC.
Information regarding Pandora's directors and executive officers is
contained in Pandora's Annual Report on Form 10-K for the year
ended December 31, 2017, its
Quarterly Reports on Form 10-Q for the quarterly periods ended
March 31, 2018 and June 30, 2018 and its Proxy Statement on Schedule
14A, dated April 10, 2018, which are
filed with the SEC. Additional information regarding the interests
of those participants and other persons who may be deemed
participants in the transaction may be obtained by reading the
registration statement(s) and the proxy statement(s)/prospectus(es)
when they become available. Free copies of these documents may be
obtained as described in the preceding paragraph.
FORWARD-LOOKING STATEMENTS
This communication contains "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995. Such statements include, but are not limited to, statements
about future financial and operating results, our plans,
objectives, expectations and intentions with respect to future
operations, products and services; and other statements identified
by words such as "will likely result," "are expected to," "will
continue," "is anticipated," "estimated," "believe," "intend,"
"plan," "projection," "outlook" or words of similar meaning. Such
forward-looking statements are based upon the current beliefs and
expectations of our management and are inherently subject to
significant business, economic and competitive uncertainties and
contingencies, many of which are difficult to predict and generally
beyond our control. Actual results and the timing of events may
differ materially from the results anticipated in these
forward-looking statements.
In addition to factors previously disclosed in Sirius' and
Pandora's reports filed with the SEC and those identified elsewhere
in this communication, the following factors, among others, could
cause actual results and the timing of events to differ materially
from the anticipated results or other expectations expressed in the
forward-looking statements: ability to meet the closing conditions
to the merger, including the approval of Pandora's stockholders on
the expected terms and schedule and the risk that regulatory
approvals required for the merger are not obtained or are obtained
subject to conditions that are not anticipated; delay in closing
the merger; failure to realize the expected benefits from the
proposed transaction; risks related to disruption of management
time from ongoing business operations due to the proposed
transaction; Sirius' or Pandora's substantial competition, which is
likely to increase over time; Sirius' or Pandora's ability to
retain subscribers or increase the number of subscribers is
uncertain; Sirius' or Pandora's ability to profitably attract and
retain subscribers; failing to protect the security of the personal
information about Sirius' or Pandora's customers; interference to
Sirius' or Pandora's service from wireless operations; Sirius and
Pandora engage in substantial marketing efforts and the continued
effectiveness of those efforts are an important part of Sirius' and
Pandora's business; consumer protection laws and their enforcement;
Sirius' or Pandora's failure to realize benefits of acquisitions or
other strategic initiatives; unfavorable outcomes of pending or
future litigation; the market for music rights, which is changing
and subject to uncertainties; Sirius' dependence upon the auto
industry; general economic conditions; existing or future
government laws and regulations could harm Sirius' or Pandora's
business; failure of Sirius' satellites would significantly damage
its business; the interruption or failure of Sirius' or Pandora's
information technology and communications systems; rapid
technological and industry changes; failure of third parties to
perform; Sirius' failure to comply with FCC requirements;
modifications to Sirius' or Pandora's business plan; Sirius' or
Pandora's indebtedness; Sirius' studios, terrestrial repeater
networks, satellite uplink facilities or Sirius' or Pandora's other
ground facilities could be damaged by natural catastrophes or
terrorist activities; Sirius' principal stockholder has significant
influence over its affairs and over actions requiring stockholder
approval and its interests may differ from interests of other
holders of Sirius' common stock; Sirius is a "controlled company"
within the meaning of the NASDAQ listing rules; impairment of
Sirius' or Pandora's business by third-party intellectual property
rights; changes to Sirius' dividend policies which could occur at
any time; and risks related to the inability to realize cost
savings or revenues or to implement integration plans and other
consequences associated with mergers, acquisitions and
divestitures. The information set forth herein speaks only as of
the date hereof, and Sirius and Pandora disclaim any intention or
obligation to update any forward looking statements as a result of
developments occurring after the date of this communication.
Annualized, pro forma, projected and estimated numbers are used
for illustrative purpose only, are not forecasts and may not
reflect actual results.
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SOURCE Sirius XM Holdings Inc.