Sirius XM, who’s been paying royalties to artist using pre-1972 recordings, and Pandora have mad an agreement to make a $480 million planned investment in personalized online radio service. This deal has made SiriusXM Pandora’s largest shareholder.
In this agreement, Sirius XM will be purchasing convertible stock of Pandora, which they’ve already bought $172.5 million of preferred stock. This would represent a stake of 19 percent in Pandora or a 16 percent when its converted. The company has said that the cash injection “will allow Pandora to make targeted investments”.
According to Stereogum, the company stated “Through this agreement, SiriusXM is making a strategic investment in the leading U.S. provider of ad-supported digital radio. With a loyal quarterly audience of nearly 100 million listeners in the U.S., Pandora is by far the leading player in the burgeoning digital audio advertising market. The capital provided through the SiriusXM investment will allow Pandora to make targeted investments and capitalize on opportunities to build on its position in the streaming radio business.”