Pandora’s share price has taken a 5.97% nosedive thanks to comments made by Liberty Media Corp Chief Executive Greg Maffei.
Maffei’s tact is quite genius really. Liberty Media, the majority owner of satellite-radio operator SiriusXM, made a $15-a-share, US$3.4bn bid to acquire Pandora last July. Pandora turned the offer down as its board was shooting for a higher value.
But after Maffei came forward and called Pandora “overvalued” at an Internet & Telecom Conference in Florida, shares of the company are trading below their 50-day moving average.
“The problem is we think the stock is overvalued,” Maffei said in an interview on Monday. “We will not pay what it is at the current market price. So I think it’s very unlikely we’re going to end up buying it.”
Maffei added that Liberty’s interest in Pandora has practically ceased:
“Holders of the stock have floated that we’re a buyer at some price at a premium,” he added. “We’re not […] We like the assets just not at this price. I don’t think we’re going to end up buying it. We’ll see.”
Shares traded at US$12.47 ahead of the Deutsche Bank Media conference and dropped to US$11.71 after Maffei’s comments.
As reported by MBW, an audience member at the conference asked what it would take for Maffei to buy Pandora.
“I would buy Pandora if it were not $13 [a share],” said Maffei. “You want to sell it for $10? We probably would buy it. But they’re not selling it for $10.”
If Pandora did sell for $10-a-share, Liberty would be purchasing the internet radio giant for just under US$2.3bn – US$1.1bn less than its offer last year.