MUMBAI: Reliance Industries Ltd (RIL) has executed definitive agreements for merging its digital music service JioMusic with music over-the-top (OTT) platform Saavn. The combined entity is valued at over $1 billion, with JioMusic’s implied valuation at $670 million.

According to the release issued by RIL, the integrated business will be developed into a media platform with global reach, cross-border original content, an independent artist marketplace, consolidated data and a mobile advertising medium.

RIL will also invest up to rupee equivalent of $100 million, out of which $20 million will be invested upfront, for growth and expansion of the platform into one of the largest streaming services in the world. The company will continue to operate the OTT 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 and will drive growth of the combined entity.

In addition, RIL is acquiring partial stake from the existing shareholders of Saavn for $104 million, while these shareholders retain their balance stake. The shareholder base of Saavn includes Tiger Global Management, Liberty Media and Bertelsmann.

JioMusic has sourced content from all the major Indian and international labels, with over 16 million HD songs across 20 languages.

The deal will combine the streaming media expertise of Saavn with the connectivity and digital ecosystem of Jio. With a massive addressable market opportunity of over 1 billion users in India and globally, the combined entity plans to invest aggressively to accelerate growth that would benefit all aspects of the ecosystem, including users, music labels, artists and advertisers.

The combined platform will also build on Saavn’s award-winning original programming, artist originals (AO), which have redefined the development, marketing and distribution of original audio content. Saavn also conceptualises, produces, distributes and licenses original music with independent artists.

Reliance Jio director Akash Ambani said, “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. 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.”

Saavn co-founder and CEO Rishi Malhotra added, “Nearly 10 years ago, we had a vision to build a connected music platform, dedicated to South Asian culture across the globe. Vin, Param and I always envisioned the company for the long term with intense focus on products, data, and ground-breaking original content. Our alignment with Reliance enables us to create one of the largest, fastest-growing, and most capable media platforms in the world.”