U.K. digital music company 7digital plans to accept an acquisition bid by Songtradr for 19.4 million pounds ($23.4 million), 7digital announced Wednesday (Feb. 8).

7digital shareholders will receive 0.695 pence ($0.84) per share in cash, a 114% premium over the prior day’s closing price.

7digital directors, who collectively hold 43.7% of outstanding shares, intend to recommend that shareholders vote in favor of the acquisition. Songtradr says it has also received irrevocable undertakings to vote in favor of the deal from institutional and other shareholders representing 24.8% of outstanding shares.

Since its founding in 2014, Santa Monica, Calif.-based Songtradr has raised over $100 million to build a company intent on solving many of the inefficiencies in music licensing. It acquired AI metadata and music search company Musicube in 2022, music licensing agency Massive Music in 2021 and licensing agency Big Synch Music in 2019. In addition, Songtradr established a global creative division, led by industry vet Amanda Schupf, in 2021.

Songtradr’s announcement highlighted a number of strategic benefits it will receive from the proposed transaction. For starters, 7digital would give Songtradr a platform and music catalog that “will enhance relationships with existing customers and accelerate new customer acquisition” and put the company “in an advantageous position to provide unmatched combined solutions” in the video game space for both licensors and music rights holders.

Also, 7digital, which launched in 2004, would give Songtradr a technology solution that “delivers both music and audio rights at scale, metadata enhancement, digital rights management, content tracking and royalty spending.” The acquisition would allow Songtradr to quicken its growth strategy and “simplify global music licensing,” the announcement added.

Following the acquisition, current 7digital CEO Paul Langworthy will join Songtradr along with the rest of the senior leadership team, though interim chairman Mark Foster, CFO Michael Juskiewicz and all nonexecutive directors will step down. Songtradr will additionally repay 7digital’s £2 million ($2.14 million) revolving credit facility as well as two £500,000 ($536,000) loans. It will continue to operate 7digital’s London office for the time being.

The acquisition marks the close of a turbulent few years for 7digital, which in July 2019 faced the possibility of entering administration — or the U.K. equivalent of Chapter 11 bankruptcy — unless it managed to raise £4.5 million ($5.5 million) in additional funds by the end of that month.