India’s oldest label, Saregama India Ltd., has acquired a 51.8% stake in Indian digital entertainment company Pocket Aces in an all-cash deal worth 1.74 billion Indian rupees (approx. USD $20 million).
The deal, confirmed by Saregama in a press release on Thursday (September 28), gives Saregama the option to acquire an additional 41% stake in Pocket Aces in the next 15 months.
Saregama says the acquisition “will further strengthen Saregama’s strategic ambition to take leadership position in New Music across all Indian languages.”
Pocket Aces is a youth-focused digital content creation and publishing company with an IP catalog of more than 3,000 contents encompassing web series, sketches, music videos, and reels, distributed through its channels FilterCopy, Nutshell, and Gobble.
The company releases over 30 new content pieces daily, reaching audiences on OTT platforms like Netflix, Hotstar, and Amazon.
According to Saregama, its partnership with Pocket Aces will expand its intellectual property holdings and provide access to a vast distribution network of over 95 million followers across Instagram, YouTube and other social media platforms.
In the fiscal year 2023, Pocket Aces’ revenues rose 34% on a compound annual growth rate over the past four years to 1.04 billion rupees ($12.5 million), and is expected to expand at a faster rate in the future, according to Saregama.
The company says the acquisition is also aimed at enhancing the promotion of its music library, particularly within the 18-35-year-old demographic. Additionally, the partnership seeks to promote synergies in artist and influencer management, as well as long-format video production.
“While we have always been leaders in the realm of music and media, this partnership with Pocket Aces will add new dimensions to our business as we tap into the burgeoning young digital audiences.”
Avarna Jain, Saregama
“This acquisition signifies the confluence of tradition and innovation. While we have always been leaders in the realm of music and media, this partnership with Pocket Aces will add new dimensions to our business as we tap into the burgeoning young digital audiences,” said Saregama Vice Chairperson Avarna Jain.
Saregama, formerly known as The Gramophone Company of India Ltd., says it holds “the largest music archives in India,” which is one of the biggest in the world. The company says its ownership of “nearly 50 percent of all the music ever recorded” in India makes it “the most authoritative repository of the country’s musical heritage.”
In addition to holding music assets, Saregama has also expanded into publishing, film production, and digital content creation.
Saregama is owned by Indian conglomerate RP-Sanjiv Goenka Group (RPSG Group), which has a diverse portfolio encompassing ventures in power and energy, carbon black manufacturing, retail, IT-enabled services, FMCG, media and entertainment, as well as agriculture.
Saregama’s acquisition of Pocket Aces comes as India’s music, radio and podcast businesses are forecast to grow an average of 19.1% annually in the comping years, reaching about 110.26 billion rupees (approx. USD $1.33 billion) by 2025, according to a PwC report from 2021.
The deal with Pocket Aces came over three years after Saregama formed a licensing deal with music streaming giant Spotify, which saw Saregama’s songs added to Spotify’s platform in the Indian market.
In 2018, Saregama also inked a similar agreement with Amazon Prime Music.
Music Business Worldwide