Podcasts from Steve Austin and Shaquille O’Neal are big draws. Why this L.A. company wants in

West Hollywood-based digital media company LiveXLive Media Inc., which specializes in streaming live musical events, is getting into the burgeoning podcast business.

On Friday, LiveXLive said it plans to buy Courtside Group Inc., owner of Beverly Hills-based PodcastOne, in an all-stock transaction.

LiveXLive is contributing 5.45 million of its shares to Courtside, valuing the deal at $18.1 million based on LiveXLive’s closing stock price of $3.32 on Thursday, which was up 10%. The deal is expected to close by June.

Executives at LiveXLive and PodcastOne said they believe combining the two companies will give their partners and customers a greater breadth of content and features. Launched in 2015, LiveXLive offers a service that streams music, on-demand video and live event performances.

The acquisition will allow the company to expand into the growing podcast space, which has seen a flurry of dealmaking and consolidation as new players such as Spotify invest heavily in the medium. That has put more pressure on independents such as PodcastOne to diversify and bulk up in order to compete.

PodcastOne has more than 300 podcasts, including shows from radio personality Adam Carolla, retired professional wrestler Steve Austin and former basketball star Shaquille O’Neal. PodcastOne generates more than 2.1 billion downloads annually.

“There’s no question that bigger was better before the COVID virus and bigger is better certainly during the COVID crisis,” said Norman Pattiz, PodcastOne’s executive chairman.

Both companies have been affected by the coronavirus crisis, which has changed the habits of consumers used to listening to podcasts on their commutes and shelved many concerts. During the pandemic LiveXLive has streamed live concerts from artists at home or in their studios.

But podcasting is one of the few entertainment areas that can continue production despite the pandemic, as hosts can record themselves at home. And more podcasts are being made as people have more time on their hands.

Pattiz said the market for podcasts is changing. He founded PodcastOne a decade ago and the company grew to become a pretty big fish in a small pond. But now, larger players from the radio business or digital companies are getting into the space, making the market even more competitive.

“One has to look for other ways to differentiate their product from other competitors and hooking up with LiveXLive makes perfect sense because we have so many compatible ways of growing our businesses,” Pattiz said.

LiveXLive and PodcastOne offer products free with ads or through subscriptions. LiveXLive, which primarily makes money through subscriptions and sponsorships, has 820,000 subscribers. PodcastOne mainly makes money through advertising and has a few thousand subscribers.

Through the acquisition, LiveXLive will triple its sales staff to 15 people and will increase its total employee count from 81 to about 120 full-time employees this year. Pattiz will remain executive chairman of PodcastOne.

“The acquisition will add to and diversify our revenue with a strong advertising component,” said LiveXLive CEO Robert Ellin.

LiveXLive’s business is growing, with the company streaming more than 775 artists since Jan. 1, up from 300 artists for the whole year of 2019.

Sales grew nearly 8% to $9.7 million in the fiscal third quarter compared to the same period a year ago. The company, however, reported a net loss of $8.8 million in the quarter.