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INGROOVES ACQUIRES FONTANA DISTRIBUTION

INGROOVES ACQUIRES FONTANA DISTRIBUTION

Creates INgrooves Fontana: Combining Best-in-Class Digital and Physical Distribution to Empower Independent Music Community

SAN FRANCISCO & LOS ANGELES, CA, March 2, 2012…In a move which will further empower the independent music community, INgrooves, a leading provider of digital distribution, marketing and technology services to the global music community, announced today that it has acquired Fontana Distribution from Universal Music Group (UMG). The new company, INgrooves Fontana, combines INgrooves’ asset management and distribution platform and a decade of experience in the digital world, with Fontana’s digital and physical distribution and marketing capabilities, to offer a complete solution to indie labels — the best in class digital and physical distribution services. The announcement was made today by Robb McDaniels, Founder & CEO INgrooves, and Zach Horowitz, President & Chief Operating Officer of UMG. UMG holds a minority equity interest in INgrooves. Financial terms of the deal were not disclosed.

“Through this acquisition, we are now able to offer the independent music community a fully integrated physical and digital distribution marketing solution in North America,” said Mr. McDaniels.  “We believe that a successful relationship between distributor and label is, at its root, a flexible structure with a transparent flow of information. By combining INgrooves and Fontana, we will be able to extend this philosophy into a comprehensive distribution operation that provides our collective client base with a larger sales force, more marketing resources and a one-stop global retail network that maximizes opportunities in this dynamic, challenging environment.”
“INgrooves’ commitment to independent music is second to none,” stated Mr. Horowitz. “The combination of INgrooves and Fontana creates one of the strongest, most innovative companies in the business today, uniquely positioned to superserve its distributed labels with some of the most sophisticated executive talent in this genre of music, cutting edge technology, and enhanced marketing services. As a minority owner of INgrooves, we believe this new style of relationship with the independent community maximizes the potential of our investment and creates the single best home for independent labels.”

As part of this arrangement, INgrooves Fontana will continue to work with UMG’s award winning sales force in connection with the physical sales of the company’s releases.

INgrooves Fontana will be run by Dave Zierler, President of INgrooves and Ron Spaulding, President of Fontana.   Together, the two veteran distribution executives will report to Mr. McDaniels as they continue to oversee their respective businesses.

“Dave and Ron have both been extraordinarily successful over the past four years in their respective roles and have built great teams and solid relationships with labels and retailers,” added Mr. McDaniels.  “INgrooves Fontana will provide both leaders with a platform to continue their phenomenal growth and deliver superior services to our clients.”

One benefit of the transaction for INgrooves Fontana clients is the expansion of the Label & Artist Services group.  This unit, which currently provides product management, online marketing & PR coordination, sync licensing, brand partnership marketing, sponsorships and advertising for the respective companies, will be a core focus of expansion in the coming months. These value-added services will be available to INgrooves Fontana clients on a per project basis.

INgrooves has provided UMG with digital delivery services for Fontana’s catalogue in North America since 2008 via its proprietary ONE Digital enterprise software platform.  The two companies have also collaborated on many successful projects over the past few years, including releases from The Crystal Method and rapper Mac Miller, whose debut release entered the Billboard charts at Number One last fall.

The combined companies represent clients including Fat Possum, Nettwerk, Dualtone, Rostrum Records, ESL Music, Metropolis, OM Records, Vagrant Records, Strange Music, Watertower Music, Dangerbird, Rap-A-Lot, Downtown Records and Music World among their many independent label partners.