July 10 Online music sharing service SoundCloud
Ltd is close to a deal with Universal Music Group, Sony Music
Entertainment, and Warner Music Group for licenses to continue
playing their songs and avoid potential legal disputes,
Bloomberg reported citing people with knowledge of the matter.
SoundCloud is in return negotiating offering a 3 percent to
5 percent stake to the companies as well as a percentage of
future revenue, the website reported.
SoundCloud is a platform that enables people to upload,
record, promote, and share their music and other audio files.
If the deal goes through, SoundCloud would be valued between
$500 million and $600 million, Bloomberg reported. (bloom.bg/1nctD95)
The service will pay the record labels based on how many
times a song is played until the company's revenue crosses a
certain threshold, the report said.
Twitter Inc was also in talks to acquire the
Berlin-based startup earlier this year as it sought to add a
music service to its offerings.
SoundCloud and Sony Music, a unit of Sony Corp,
could not immediately be reached for comment outside regular
U.S. business hours. Warner Music, a subsidiary of privately
held American conglomerate Access Industries, and Universal
Music, the music entertainment arm of Vivendi SA, could
also not immediately be reached for comment.
(Reporting by Ramkumar Iyer in Bangalore; Editing by Lisa