Reliance Industries Limited signed definitive agreements to combine music-streaming business Saavn, with its own digital music service, JioMusic.
The deal will combine the streaming media expertise of Saavn with the connectivity and digital ecosystem of Jio, to tap a “billion users in India and globally,” the companies said in the official statement.
The combined entity is valued at over USD 1 billion, with JioMusic’s implied valuation pegged at USD 670 million. In addition, Jio will invest an additional USD 100 million towards making the combined platform one of the largest music streaming services in the world.
Reliance Industries will also acquire a part of the stake held by Saavn’s existing shareholders for a sum of USD 104 million.
Commenting on the association, Akash Ambani, Director, Reliance Jio, said, “We are delighted to announce this partnership with Saavn, and believe that their highly experienced management team will be instrumental in expanding Jio-Saavn to an extensive user base, thereby strengthening our leadership position in the Indian streaming market.”
The integrated business will be developed into a media platform with global reach, cross-border original content, an independent artist marketplace, consolidated data and one of the largest mobile advertising mediums, the oil-to-telecom behemoth said in a statement.
The Jio-Saavn deal comes weeks after rival company Gaana announced a USD 115 million investment in a funding round led by China’s Tencent Holdings.
The shareholder base of Saavn includes Tiger Global Management, Liberty Media, and Bertelsmann, among others. Whereas, JioMusic has been India’s fastest growing music streaming application for over 60 consecutive weeks. It sources content from all major Indian and international labels and currently has over 16 million high definition songs across 20 languages on its platform.
As per the official statement, the company will continue to operate the over-the-top media platform available on all app stores. The three co-founders of Saavn, Rishi Malhotra, Paramdeep Singh and Vinodh Bhat, will continue in their leadership roles in the combined entity.
“Nearly 10 years ago, we had a vision to build a connected music platform, dedicated to South Asian culture across the globe. Our alignment with Reliance enables us to create one of the largest, fastest-growing, and most capable media platforms in the world,” said Rishi Malhotra, co-founder and CEO, Saavn.
Founded in 20017, Saavn offers 36 million tracks in 15 languages. The company has more than 900 label partnerships, including Universal, Sony, T-Series, Tips, YRF, Saregama, Eros and Warner Music.
Recently, social networking giant Facebook has signed a licensing agreement with major record label Warner Music. The new partnership will cover the music company’s recorded music and music publishing catalogs for use in social media.
Under the agreement, users of Facebook, Instagram, Messenger and Oculus will be able to upload and share videos containing licensed music in the Warner Music and Warner/Chappell catalogs.
JioMusic claims content from all the major Indian and international labels, with over 16 million HD songs across 20 languages.