SiriusXM To Refile DOJ Application To Acquire Pandora

The Dept. of Justice’s Antitrust Division has been casting a skeptical eye at a number of media mergers, and that scrutiny now appears to be extending to the audio marketplace, reports InsideRadio.

Faced with the possibility the DOJ could reject SiriusXM Radio’s proposal to buy Pandora in an all-stock deal valued at $3.5 billion, the satellite radio company has instead temporarily withdrawn its application for review. The two companies still intend to proceed with the buyout, however it now appears the structure of the transaction may need to be revised into order to win antitrust clearance.

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In a pair of filings with the Securities and Exchange Commission, SiriusXM and Pandora said it was at the DOJ’s urging that they agreed on Sunday to voluntarily withdraw their application and then refile a new application on Wednesday, Nov. 21. That would give government antitrust attorneys until Dec. 21 to complete their review or seek additional information.

While the move doesn’t mean the proposed buyout will necessarily be rejected, it’s a strong indication that the DOJ needs more time to assess the impact of allowing the monopoly satellite radio service to absorb one of the largest streaming music services in the country.

In the filings, the two companies remained optimistic they will win approval.

The combination of SiriusXM and Pandora would create an audio entertainment powerhouse with more than $7 billion in expected pro-forma revenue in 2018. The two companies have said they are initially focused on creating cross-promotional opportunities between the satcaster's 36 million North American subscribers and Pandora's 70 million monthly active users. The companies have also said they plan to leverage each other’s audiences and content to create new audio packages, while also using SiriusXM's automotive relationships to drive Pandora's in-car distribution.