Pandora investor wants a sale
Activist hedge fund Corvex Management is pressuring Pandora Media to explore a sale of the Oakland streaming music company.
Corvex managing partner Keith Meister wrote an open letter Monday questioning the strategies of Pandora’s newly returned CEO and founder Tim Westergren and urging the company’s board to consider a sale.
“We have become increasingly concerned that the company may be pursuing a costly and uncertain business plan, without a thorough evaluation of all shareholder value-maximizing alternatives,” Meister wrote in the letter, filed with the Securities and Exchange Commission.
“Pandora is on the cusp of realizing an extraordinary vision: fundamentally changing the way listeners discover and enjoy music, and the way artists build and sustain their careers,” it said.
Pandora has about 81 million monthly active listeners but is battling streaming music and media services from Spotify, Apple, Amazon and Google.
In a research note, analyst Robert Peck said Sun Trust believes “logical acquirers” of Pandora would include rival Spotify, wireless carriers AT&T and Verizon, and entertainment and communications conglomerate Liberty Media, which has a stake in satellite radio company SiriusXM.
[...] he said, “we find it difficult to reconcile Mr. Westergren’s idealism and music industry evangelism with the goal of maximizing risk-adjusted shareholder value and your responsibilities to investors.”