SiriusXM is acquiring Pandora in a $3.5 billion all-stock deal. The combined company will have more than 100m active users and a market value of about $34b—that’s bigger than Spotify’s $31.2b.

Pandora shareholders will receive 1.44 newly issued shares of Sirius XM for every share they hold. Sirius XM owns about 15% of convertible preferred Pandora stock.

Speaking of stock, Sirius, which closed at $6.98 on Friday, is down about 8.7% on the news, currently trading at $6.37.

For SiriusXM, controlled by John Malone’s Liberty Media, the acquisition brings the company an on-demand option, while giving the savvy Malone a seat at the big table alongside Cook, Ek and Bezos. For Pandora, the door may be opened to get the service into cars. With the services combined, they increase their ability to compete with Spotify, Apple Music and Amazon Prime Music.

SiriusXM CEO Jim Meyer said, “The addition of Pandora diversifies SiriusXM’s revenue streams with the U.S.’ largest ad-supported audio offering, broadens our technical capabilities and represents an exciting next step in our efforts to expand our reach out of the car even further.

“Through targeted investments, we see significant opportunities to drive innovation that will accelerate growth beyond what would be available to the separate companies, and does so in a way that also benefits consumers, artists, and the broader content communities.”

Pandora CEO Roger Lynch said the pairing makes the company “even better positioned to take advantage of the huge opportunities we see in audio entertainment, including growing our advertising business and expanding our subscription offerings.”

SiriusXM has 36m subscribers, while Pandora boasts 70m active users per month. The deal is expected to close in the first quarter of 2019.