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Sony Corp in talks to buy rest of EMI Music Publishing

By | Published on Monday 12 March 2018

EMI Music Publishing

Sony Corp has held preliminary talks to acquire the rest of EMI Music Publishing, according to sources that have spoken to Bloomberg. One of the other shareholders in the songs business is reportedly seeking a valuation for the company nearly double what the Sony-led consortium it was part of originally paid for it. Which would be about $4 billion.

The acquisition of the EMI publishing company was led by Sony back in 2012, after the bankers at Citigroup repossessed the old EMI Group and split it into two – recordings and publishing – to sell on to the other major music corporations.

Joining Sony in its $2.2 billion acquisition of the publishing side were its then partners in its own songs business Sony/ATV – the Michael Jackson estate – along with finance firms Mubadala Development, Jynwel Capital and Blackstone Group, and music industry veteran David Geffen.

Since the purchase, Sony/ATV has administrated the EMI Music Publishing catalogue, meaning Sony/ATV/EMI has basically been run as one company, even though technically they remain two distinct entities.

Chatter about Sony Corp possibly seeking to buy out its partners in EMI began last year, with Variety noting that the administration deal between Sony/ATV and EMI expired in 2018 and that that would be the logical moment to rejig things. A source at one of the finance firms involved in the 2012 acquisition also told Variety last year that it would be quite happy to be bought out if a suitably large cheque was on offer.

That may well have been Mubadala Development. Bloomberg says that the Abu Dhabi sovereign wealth fund is now actively talking to Sony Corp about selling its share in EMI, while also sounding out other possible bidders. Sources say that the investment outfit could force a sale of the entire EMI Music Publishing business if Sony can’t reach a buy-out deal with its partners in the 2012 acquisition.

It’s also seemingly Mubadala that is seeking a valuation of at least $4 billion for the EMI business, hoping to capitalise on the renewed interest in owning music rights partly fuelled by the streaming boom. The EMI catalogue boasts many valuable works, and with older songs the publisher likely has control of them for life of copyright, subject to the reach of the songwriter’s ‘termination right’ under American copyright law, which is still being worked out.

If Sony did take complete ownership of EMI Music Publishing, having already bought out the Jackson estate from its Sony/ATV venture, it would make the entertainment conglom the undisputed major player in song copyrights. Meanwhile, once fully in control of Sony/ATV/EMI, Sony Corp might be able to more closely align its global recordings and music publishing businesses, which have operated pretty autonomously to date.