Satellite and streaming radio company SiriusXM Pandora has agreed to buy the podcast platform Stitcher from broadcaster E.W. Scripps, the companies announced in a joint press statement on Monday.
The total valuation of the acquisition is $325 million, with SiriusXM agreeing to pay $265 million in cash right now and another $60 million in case over the next two years depending on the previous year’s financial results.
The sale of Stitcher to SiriusXM was not unexpected — negotiations were earlier reported by the Wall Street Journal, though the newspaper capped the possible sale price at $300 million. Scripps acquired Stitcher from streaming music service Deezer four years ago for just $4.5 million.
“This sale is consistent with Scripps’ track record of growing businesses that capitalize on the evolution of consumers’ media habits and then unlocking shareholder value through spinoffs, exits and continued organic growth,” Scripps execuive Adam Symson said in a statement. “Over and over, this strategy has proven effective as well as profitable for the company and its shareholders.”
Stitcher operates a handful of podcast production companies that churn out hit shows like “Conan O’Brien Needs a Friend” and “Freakanomics.” Coupled with its advertising service Midroll, Stitcher has generated revenue in the tens of millions of dollars for Scripps; last year, the company earned $72.5 million in advertising and subscription revenue.
As part of the deal, all Scripps employees working on Stitcher will be transferred to SiriusXM. The sale is expected to close later this year.