Reliance Industries and Saavn Forms India’s Largest Platform for Music
Reliance Industries announced a ‘strategic transaction’ with Saavn to form India’s largest platform for music, media and artists. The combined entity is valued at over $1 billion. The tie-up implies JioMusic valuation at $670 million. Over and above that, Reliance revealed in a statement, it would be further investing up to $100 million more for boosting growth. The tie-up is between Saavn, a leading global music OTT platform and RIL’s digital music service, JioMusic. It also added that the deal will combine the streaming media expertise of Saavn with the connectivity and digital ecosystem of Jio.
According to RIL, “The integrated business will be developed into a media platform of the future with global reach, cross-border original content, an independent artist marketplace, consolidated data and one of the largest mobile advertising mediums.” However, there will be no disturbing the current structure of the company and the three co-founders of Saavn, Rishi Malhotra, Paramdeep Singh and Vinodh Bhat, will continue in their leadership roles. The statement said that they have been tasked with driving growth of the combined entity.
Reliance also revealed that it is acquiring a partial stake from the existing shareholders of Saavn for $104 million, even as these shareholders retain their balance stake. Saavn shareholder base includes Tiger Global Management, Liberty Media, Bertelsmann, among others.
Akash Ambani, Director, Reliance Jio, had this to say about the transaction, “The investment and combination of our music assets with Saavn underlines our commitment to further boost the digital ecosystem and provide unlimited digital entertainment services to consumers over a strong uninterrupted network.”
Of the $100 million investment, rupee equivalent of $20 million will be invested upfront, for growth and expansion of the platform. The goal being to turn it into one of the largest streaming services in the world. The over-the-top media platform of the company available on all app stores is expected to continue to operate.
Rishi Malhotra, Co-Founder and CEO, Saavn, in his reaction said, “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.”
RIL claimed that JioMusic has been the country’s fastest growing music streaming app for over 60 consecutive weeks. JioMusic has sourced content from all the major Indian and international labels, with over 16 million HD songs across 20 languages. Reliance says that the new entity will be targetting a market opportunity that consists of over 1 billion users in India and globally.