Stock Update (NYSE:P): Pandora Media Inc to Acquire Key Assets from Rdio

Pandora Media Inc (NYSE:P), the world’s most powerful music discovery platform, today announced an agreement to acquire several key assets from Rdio, a pioneer in streaming music technology. This will accelerate the company’s plan to offer fans greater control over the music they love, strengthening Pandora’s position as the definitive source of music.

“Whether streaming through radio, on-demand or in-person at live events, Pandora is building the definitive source for fans to discover and celebrate music,” said Brian McAndrews, chief executive officer at Pandora. “Wherever and however fans want to hear music, we intend to be their go-to destination.”

In addition to acquiring technology and intellectual property from Rdio, many members of Rdio’s team will be offered roles with Pandora, subject to close of the agreement. The company expects to offer an expanded Pandora listening experience by late 2016, pending its ability to obtain proper licenses.

The purchase price is $75 million in cash, subject to certain purchase price adjustments.

“We are defining the next chapter of Pandora’s growth story,” continued McAndrews. “Adding live music experiences through Ticketfly was a transformative step. Adding Rdio’s impressive technology and talented people will fast-track new dimensions and enhancements to our service. I couldn’t be more optimistic about Pandora’s future and the future of music.”

“The Rdio team built an acclaimed product and technology platform that has consistently led innovation in the young streaming industry. I’m pleased that many members of the Rdio team will continue to shape the future of streaming music, applying our tradition of great design and innovative engineering on an even larger stage with Pandora,” said Anthony Bay, chief executive officer of Rdio.

The transaction is contingent upon Rdio seeking protection in the United States Bankruptcy Court for the Northern District of California. Upon approval of the proposed transaction by the bankruptcy court, Rdio will be winding down the Rdio-branded service in all markets. Pandora is not acquiring the operating business of Rdio, and is acquiring the technology and talent to accelerate its own business strategy. The transaction is subject to the approval of the Bankruptcy Court, which will supervise an auction for the assets of Rdio, as well as other customary closing conditions. (Original Source)

Shares of Pandora Media closed today at $13.42, down $0.02 or 0.15%. P has a 1-year high of $22.60 and a 1-year low of $11.38. The stock’s 50-day moving average is $16.82 and its 200-day moving average is $17.32.

On the ratings front, Pandora has been the subject of a number of recent research reports. In a report issued on November 5, FBR analyst Barton Crockett maintained a Sell rating on P, with a price target of $10, which represents a potential downside of 25.3% from where the stock is currently trading. Separately, on October 26, Macquarie’s Amy Yong upgraded the stock to Buy and has a price target of $19.

According to, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Barton Crockett and Amy Yong have a total average return of 11.0% and 7.8% respectively. Crockett has a success rate of 60.7% and is ranked #291 out of 3842 analysts, while Yong has a success rate of 66.7% and is ranked #1034.

The street is mostly Bullish on P stock. Out of 19 analysts who cover the stock, 9 suggest a Buy rating , 8 suggest a Hold and 2 recommend to Sell the stock. The 12-month average price target assigned to the stock is $18.58, which represents a potential upside of 38.8% from where the stock is currently trading.

Pandora Media Inc provides internet radio services on smartphones, tablets, traditional computers and car audio systems, as well as other internet-connected devices.


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