The Mohn family, who own the majority of German media conglomerate Bertelsmann, are expected to makes moves this week to buy back the 25.1% stake in the company owned by Belgian investment firm Groupe Bruxelles Lambert.
As previously reported, the family have been planning the buy out for some time following reports that GBL was intending to sell its stake in the firm via a stock market flotation - something the Mohns oppose. GBL are expected to announce that intention at Bertelsmann's annual shareholder meeting later today - an announcement which will spark the Mohns' attempted buy out.
It remains to be seen how quickly the Mohns explain how they plan to fund the buy out. Although bank loans have been mooted, reports suggest the favoured way to raise the estimated $5.1 billion required to buy out GBL is for Bertelsmann to sell its 50% share of SonyBMG and/or its 100% share of BMG Music Publishing.
Either move, and especially the former, would have interesting implications for the music industry. As co-owners of SonyBMG, Sony Corp would have the first option to buy the stake in the joint venture major record company, although there is mixed opinion as the whether the Japanese conglomerate could or would do so.
If they choose not to, a consortium of banks and private investors may be the most likely buyers, although moves by either of the two smaller major record companies - EMI or Warner - to acquire the 50% stake in SonyBMG is not entirely impossible. Though if they did, there would be interesting monopolies questions to be answered - while further consolidation of the music business is probably inevitable, a combined Sony/BMG/EMI is unlikely to be popular with officials - given that such a power house would dwarf not only Warner Music, but also current market leader Universal Music.