Updated from 1:36 p.m. EST with comments from SoundCloud.
Music streaming company Spotify has abandoned its plans to acquire competing music streamer SoundCloud, sources told TechCrunch.
Rumors of a deal between the two companies began to swirl in September, when the Financial Times said that the pair was in "advanced talks." This week, however, sources told TechCrunch that London-based Spotify walked away from the table due to potential complications surrounding the company's widely-speculated upcoming IPO.
The sources said at this moment, Spotify feels that it "doesn't need an additional licensing headache in a potential IPO." If Spotify explored a deal, the company would need to battle with music labels over SoundCloud's indie-focused track catalogue, incurring additional costs.
This isn't the first time that Spotify has stood up SoundCloud. The company previously approached SoundCloud two times over the past two years for deals, but turned away due to pricing issues, the Financial Times reports.
A SoundCloud spokeswoman said that the company does not comment on speculation and rumors, while a Spotify representative was not immediately available for comment.
Kathleen Smith, chairman of Renaissance Capital, a manager of IPO-focused ETFs, said that she "isn't surprised Spotify is being careful about what it does" moving into an IPO.
