Pandora shares rose 10.3 percent to $10.03 a share in premarket trading, while Sirius stock fell 0.4 percent to $6.95 a share.
Shareholders will receive 1.44 of newly issued SiriusXM shares for each Pandora share they hold. The implied Pandora price from this deal is $10.14 a share, or a 13.8 percent premium, according to the press release. Pandora was trading above that price in the premarket as the merger agreement also includes a "go-shop" provision where the company "may actively solicit, receive, evaluate and potentially enter negotiations with parties that offer alternative proposals following the execution date of the definitive agreement."
– CNBC's John Melloy contributed to this report.