Digital distributor The Orchard has acquired two of its rivals: European firm Finetunes and Nordic company Phonofile, in the latest bout of consolidation in the music-distribution space.

The latter two companies had merged in January 2016 under a holding company called SendR, although they had continued to operate as independent businesses. Now they will become wholly-owned subsidiaries of The Orchard – itself owned by major label Sony Music.

All three companies say the deal will be good news for their artist clients: in Finetunes and Phonofile’s case, because it will boost the global distribution clout for their music, while for The Orchard’s it will fulfil a similar purpose in Europe.

“Today is a big day for our Finetunes family. We feel confident that our labels will be best positioned for a healthy and prosperous future alongside The Orchard, who is dedicated to serving independents on a global level,” said Finetunes founder Oke Göttlich.

“We’re honored to welcome finetunes and Phonofile to The Orchard family. Their addition greatly enhances our local representation in two of Europe’s key digital entertainment markets,” said The Orchard’s CEO Brad Navin, CEO of The Orchard, adding that he sees “an exciting opportunity to provide even greater levels of service and global reach to our local clients”.

Within a few hours of the acquisition being announced, Merlin CEO Charles Caldas issued a statement criticising its potential impact, however.

“This is not positive news for the indie labels and artists affected by this deal. Merlin has long been vocal about our concerns that the majors, via their faux-indie imprints, are land-grabbing independents rights in order to bolster their market shares and use the value of those indie artists to extract disproportionate value from the market in their negotiations with digital services,” said Caldas.

“That value flows only one way, and it is not to the indie labels and their artists who actually create that value.”

Merlin knows both companies well. Phonofile’s Erik Brataas was reappointed as a member of the indie licensing agency’s board in 2015, while Finetunes’ Goettlich was appointed as a non-voting observer.

The Orchard is, equally unsurprisingly, emphasising its independent culture in its presentation of the deal.

“The Orchard’s independent spirit and structure makes this acquisition a true ‘win-win’ for all involved. We look forward to driving growth opportunities for the expanded client base both at home and abroad,” said The Orchard Europe’s MD Manlio Celotti.

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