Los Angeles-based B2B music licensing company Songtradr has agreed to acquire 7digital, a UK-based publicly listed music technology company.
That’s according to a filing published in the UK on Wednesday (February 8), which states that the transaction is expected to close in Q1 2023 and that the deal is an all-cash offer for 7digital’s entire issued share capital, valued at approx. £19.4 million ($23.4m).
7digital provides a catalog of over 80 million licensed tracks and offers API services to power music in apps across fitness, social, radio, gaming and background music.
The company claims that “hundreds of companies” from streaming services to online fitness startups and global social platforms use its so-called “music-as-a-service platform” to power the backend of their music licensing and use.
On its website, 7digital explains further that, using its tech companies can “connect their apps with licensed music from any label or publisher using a fully integrated suite of APIs”.
Elsewhere in Wednesday’s (February 8) filing, Songtradr says that, via the deal, it will get a “comprehensive music and technology solution for digital platforms and music rights holders”.
It adds that this delivers “both music audio and rights at scale, metadata enhancement, digital rights management, content tracking and royalty reporting”.
The filing also claims that the deal will result in the “accelerated execution of Songtradr’s growth strategy, removing inefficiencies and friction, and simplifying global music licensing”.
Other acquisitions made by Songtradr in recent months include AI metadata and music search company, Musicube in June last year.
In addition to Musicube, Songtradr’s portfolio of music companies includes Massive Music (acquired in June 2021), Big Sync Music (acquired in February 2019) and Song Zu (acquired in March 2021).
Other companies acquired by Songtradr include film, TV and gaming music data platform Tunefind, and Pretzel, which provides DMCA-proof music for Twitch and YouTube livestreamers.
In September 2020, Songtradr invested $1m in music credit resource Jaxsta, inks exclusive partnership.
Founded in 2014, the Los-Angeles headquartered music rights firm has now raised over $100 million to date and according to Wednesday’s filing is “is backed by certain institutional investors, family offices, and high net worth shareholders”.
Songtradr has a team of more than 350 people and offices in 12 countries worldwide.
The company raised USD $50 million in an oversubscribed series D funding round in June 2021.
Songtradr‘s previous funding round follows its $30m Series C round in August in 2021, which, at the time, valued the company at $165m.
Previously, Songtradr raised $4m in a Series A funding round in 2018 and $12m in a Series B funding round in 2019.
“Songtradr’s ambition for the business matches our own and there is strong strategic alignment on how best to drive growth for the Combined Group, as well as how best to serve the needs of a growing B2B market.
Paul Langworthy, 7digital
Commenting on the Offer, Paul Langworthy, CEO of 7digital, said: “We are pleased to recommend this Offer to be made by Songtradr as it is beneficial to both the operations of the Company and our shareholders.
“Songtradr’s ambition for the business matches our own and there is strong strategic alignment on how best to drive growth for the Combined Group, as well as how best to serve the needs of a growing B2B market.
“The Offer recognises the underlying value of the Company, providing all 7digital Shareholders with the opportunity of a certain cash exit at an attractive premium to the prevailing market share price.
“We firmly believe that as part of the Combined Group, 7digital will have access to the capital, support and scale it needs to achieve its full potential.”
“Having closely followed 7digital’s evolution for a long time, we are delighted to have reached agreement to combine our businesses, expanding our position in the B2B music licensing and technology ecosystem.”
Paul Wiltshire, Songtradr
Commenting on the Offer, Paul Wiltshire, CEO of Songtradr, said: “Having closely followed 7digital’s evolution for a long time, we are delighted to have reached agreement to combine our businesses, expanding our position in the B2B music licensing and technology ecosystem.
“We are very excited with respect to what our collective team will be able to achieve in delivering an enhanced offering for our clients and to help shape the future of music licensing.”Music Business Worldwide
