Is Pandora A Takeover Target?
September 21, 2012 at 3:28 AM (PT)
BLOOMBERG reports, "APPLE INC.'s potential entry into Internet radio is poised to put online music pioneer PANDORA MEDIA INC. on the takeover wish lists of companies from GOOGLE INC. and AMAZON.COM INC. to CLEAR CHANNEL COMMUNICATIONS INC. PANDORA is projected to increase revenue by 214% in the next two years, almost triple the median for U.S. Internet media companies valued at more than $1 billion, according to data compiled by BLOOMBERG. With the shares down 34% since their initial public offering, a buyer could acquire a company trading for 21% less than the industry's average price-to-sales ratio using next year’s forecasts, the data show."
Earlier this month (NET NEWS 9/7), ALL ACCESS reported APPLE was in talks to license music for a custom-radio service similar to the popular one operated by PANDORA, in what would be a bid by the hardware maker to expand its dominance in online music. The online radio service, targeted at PANDORA and iHEARTRADIO as well as other outlets, would be available on APPLE products such as the iPHONE, iPAD and MAC computers, but not on mobile devices running the ANDROID system.
"When you look at the value of PANDORA to another company, it's the infrastructure they have created, it's the advertising business, the success with mobile," SIEMER & ASSOCIATES LLC Sr. Adviser JOHN RUDOLPH told BLOOMBERG. "PANDORA has such a big installed base and such a huge number of users, there’s value in that."