MUMBAI: Sony Music Entertainment has entered into an agreement with Dimensional Associates, LLC to acquire the remaining interest in The Orchard, the global independent music, video and film distribution company.
The Orchard will continue to operate separately from Sony Music and will be led by its existing executive team.
The deal is aligned with Sony Corp.’s recently announced strategy identifying Sony Music as one of its growth businesses. Sony plans to proactively invest in and implement a variety of measures to promote growth across its entertainment businesses, including music.
The Orchard is focused on providing world-class digital distribution services for content creators including independent labels and filmmakers. It offers clients an end-to-end solution for music and video delivery to hundreds of services and digital storefronts worldwide, as well as efficient and transparent reporting of sales and revenue. The sales, digital marketing and business development offerings also included in The Orchard’s suite of services have helped it outpace the industry in growing revenue for its clients.
Sony Music became the majority investor in The Orchard in March 2012 following the merger of The Orchard with IODA, a Sony Music-owned digital distribution company. At that time, The Orchard became the digital distributor for RED and select catalogues from Sony Music affiliates outside of the US.
This investment in The Orchard will allow Sony Music to further enhance its relationships with distribution clients all over the world. It also will allow the companies to work more closely together to drive improvements throughout the digital supply chain and quality of revenue reporting. Sony Music remains committed to operating The Orchard independently with the goal of improving the revenue and profitability of its distribution clients.
The acquisition is subject to necessary regulatory approvals.
Citigroup served as the financial advisor to Sony Music Entertainment on the transaction and UBS Securities, LLC served as the financial advisor to The Orchard on the transaction.
