Germany-based music streaming platform SoundCloud, backed by social media company Twitter, is discussing an acquisition with music streaming service Spotify, the Financial Times reported yesterday.
The acquisition would help Spotify fend off competition from technology company Apple, which launched a music subscription service in June 2015 called Apple Music that comes pre-installed on the company’s mobile devices.
Established in 2007, SoundCloud operates a music streaming service that primarily focused on independent artists. The company launched a subscription offering last year after signing licensing agreements with Warner Brothers, Sony Music and Universal Music.
SoundCloud has received approximately $190m in equity funding to date, with a $35m in debt financing provided by Tennenbaum Capital Partners in January 2015.
Twitter, which had earlier entered talks to acquire SoundCloud but withdrew in May 2014, provided $70m in series E funding in a June 2016 deal that valued the company at $700m.
Media company Chernin Group participated in a $60m series D round in January 2014, alongside Institutional Venture Partners, Kleiner Perkins Caufield & Byers, GGV Capital, Index Ventures and Union Square Ventures.