Tencent Holdings already owned more than a third of India-based Spotify rival Gaana — now it looks set to increase that stake.

That’s because Gaana — majority-owned by Times Internet — has just raised an additional $40m in debt financing from China-based Tencent’s European entity, Tencent Cloud Europe B V.

According to Entrackr, Gaana has revealed in a new regulatory filing that it’s raised 2.94bn INR (approx $40m) from Tencent by issuing 47,050 Series C optionally convertible debentures (OCD) at an issue price of 62,397.53 INR ($850) per share.

In addition, reports Entrackr, Gaana has also “passed a special resolution to increase the limit of external commercial borrowings to 6.7bn INR or $90 million to facilitate getting funds from Tencent Cloud Europe”.

Gaana’s latest debt financing round follows the music platform’s raise in September of 3.75bn INR (approximately $51m) in debt to help finance its growth.

That $51m came from two existing Gaana investors – Tencent and Times Internet – in the form of OCDs at a price of 63,761.93 INR (around $870) per share.

At the time, according to financial filings in India, the move saw Tencent’s ownership stake in Gaana increase to more than a third (34.44%), while diluting Times Internet’s stake to 60.18%.

Entrackr estimates Gaana’s value after the latest debt raise to be around $570-$580m.  That’s up from an estimated $530m in September following Gaana’s previous debt raise from Tencent.

Tencent initially acquired a stake in Gaana via a $115m investment in the company in February 2018.

Gaana announced in August 2020 that it had surpassed 185m monthly active users.

MBW reported in March that Gaana CEO Prashan Agarwal was leaving the company after an internal note confirming that he would be stepping down was issued to staff.

Gaana’s CEO is now reported to be Gautam Sinha, who is also CEO of Times Internet – Gaana’s biggest shareholder.Music Business Worldwide