Earlier this week, we learned that Pandora had asked the major labels for cash or better royalty rates. After receiving what is reported to be a tepid response from UMG, WMG and Sony, the music streamer is now talking to private equity firms in search of cash.
Pandora is in talks with private equity firms Providence Equity Partners, Silver Lake, KKR and others in search of cash, sources tell the New York Post. Tandem talks with other potential partners about strategic investments and even sale are continuing, as well. Pandora hired Centerview Partners last July to explore strategic options.
Pandora Needs Cash & Wall St. Isn't Happy
Pandora ended 2016 with just under $200 million on hand in cash and equivalents, down from $334 million at the start of last year. 2016 losses topped a record $343 million. So, it's not hard to see a scenario where, despite recent belt tightening and new revenue initiatives, the music streamer could run low on cash.
Wall Street did not take this latest news kindly, pushing the stock down 2.81% to $10.71 on Thursday. The stock has traded as high as $14.08 within the last year.