Tencent Is Said to Lead $115 Million Deal in India's Gaana
Employees check the final products in the fitting room of the assembly department of Nadir Ali Wind Instruments Pvt Ltd. , Meerut, Uttar Pradesh. (Prashanth Vishwanathan/Bloomberg News)

Tencent Is Said to Lead $115 Million Deal in India's Gaana

(Bloomberg) -- Tencent Holdings Ltd. is pushing deeper into the Indian technology market, with a sizable investment in New Delhi-based music streaming service Gaana, a person familiar with the matter said.

The investment in Gamma Gaana Ltd. totals $115 million, and Times Internet Ltd., the Indian media and technology company that started the business, will also participate, said the person, who wasn’t authorized to discuss the information publicly and asked not to be identified. Tencent and Gaana confirmed the deal was taking place in an emailed statement Wednesday.

Tencent has established a grip on the global music streaming business. It owns Tencent Music, a popular service in China that’s expected to go public as a standalone company as soon as this year. Tencent swapped shares with Spotify last year, giving it a stake in one of the most popular music streaming services in Europe and the U.S. Tencent also owns Joox in Southeast Asia.

Music streaming services, Gaana included, are generally money-losing business. One promising, venture-backed streaming company in India called Dhingana struggled to secure licenses from record labels and create a sustainable business. Dhingana was snapped up in a fire sale in 2014 by Rdio, which filed for bankruptcy the next year and was sold to Pandora Media Inc.

Tencent’s investment is a bet on the growing Indian market. The company has committed to make substantial investments in the country, which is becoming a battleground between Chinese and U.S. internet companies. Amazon.com Inc. is competing fiercely with local e-commerce startup Flipkart Online Services Pvt, which is backed by Tencent. Amazon has also said it plans to enter the music-streaming business in India.

Times Internet Vice Chairman Satyan Gajwani, who oversees the company’s digital strategy, helped shepherd the Tencent deal, the person familiar with the matter said. Times Internet may take outside investments for other technology properties this year, the person said.

©2018 Bloomberg L.P.

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