|WEDNESDAY 11 AUGUST 2021||COMPLETEMUSICUPDATE.COM|
|TODAY'S TOP STORY: Vivendi has sold 7.1% of the Universal Music Group to Pershing Square Holdings and its affiliates, though the hedge fund manager that heads up that investment fund, Bill Ackman, could as yet buy another 2.9% of the music major through other entities... [READ MORE]|
Vivendi sells 7.1% of Universal Music to investor behind failed SPAC deal
The French conglom is preparing to spin off Universal Music, of course, so to list the music business on the Dutch stock exchange next month. 60% of the shares in the standalone Universal Music will then be distributed to Vivendi's current shareholders. 20% will be controlled by a consortium led by Chinese web giant Tencent, in theory leaving Vivendi itself with the remaining 20%.
However, Vivendi announced in May that it planned to sell half of that 20% shareholding prior to the stock market listing. The buyer of that 10% of UMG was then revealed to be a US-based special purpose acquisition vehicle led by Ackman, which goes by the name Pershing Square Tontine Holdings.
Special purpose acquisition vehicles - aka SPACs or blank cheque companies - are entities that list on a stock exchange with no active operations, raising money on the investment markets to fund future acquisitions.
Usually SPACs, once listed and funded, buy an existing privately held company outright, basically providing that company with a back door stock market listing. Which made the plan to use a SPAC's monies to instead buy 10% of the soon to be publicly listed Universal Music somewhat unusual.
Sufficiently unusual, in fact, that the deal between Vivendi and Pershing Square Tontine Holdings fell through. A lukewarm response to the Universal share purchase from the SPAC's investors, coupled with concerns raised about the deal by US regulator the Securities And Exchange Commission, persuaded Ackman to have a rethink.
However, when announcing last month that the deal between Vivendi and Pershing Square Tontine Holdings was no longer going ahead, Ackman said that he still intended to buy 5-10% of Universal's shares via his other investment funds. And that has now happened.
Ackman-led hedge fund Pershing Square Holdings (not to be confused with Pershing Square Tontine Holdings, obviously) announced yesterday that "Pershing Square Holdings Ltd, Pershing Square LP and Pershing Square International Ltd - through an affiliated entity - have acquired 128,555,017 ordinary shares of Universal Music Group, representing 7.1% of the company, from Vivendi SE for approximately $21.78 per share (or 18.58 euros per share at today's exchange rate)".
When the SPAC deal fell through last month, Vivendi confirmed that, if any new deal with Ackman didn't result in the offloading of the full 10% of Universal Music it had previously pledged to sell pre stock market listing, then it would look for another buyer of whatever shares were left. That could still happen, although - Vivendi said yesterday - Ackman may as yet buy the remaining 2.9%.
Vivendi's statement read: "Vivendi sold today 7.1% of UMG's share capital to Pershing Square Holdings and affiliates, which are managed by Mr William Ackman, for a price of $2.8 billion based on an enterprise value of 35 billion euros for 100% of UMG's share capital".
"Mr Ackman has the right to acquire, by September 9, 2021, up to an additional 2.9% of UMG's share capital through funds which he manages or in which he holds the majority of economic interest, based on the same valuation", it then added, before concluding: "Vivendi is very satisfied with the arrival at UMG of Mr Ackman, a major American investor, providing once again evidence of the music company's global success and attractiveness".
With Vivendi currently planning to list the standalone UMG on the Dutch stock exchange on 21 Sep, that won't leave much time to find an alternative buyer for the other 2.9% of the company if Ackman doesn't complete a second share sale by 9 Sep. But I'm sure it will all be fine. If not, maybe we could all have a whip round and help them out. I know I've got 30 euros that have been sitting in a drawer unspendable during COVID, and I'm happy to contribute those to get things going.
US court dismisses Yout's lawsuit against the record labels, though it can submit a new claim
Usually it's the record labels that sue the operators of websites like Yout, with stream-ripping - ie services that allow people to grab permanent downloads of temporary streams - having been the music industry's top piracy gripe for some time now.
However, the owner of Yout decided to sue the labels instead. This was after the Recording Industry Association Of America urged Google to de-list Yout from its search engine database.
That request was based on the allegation that Yout had violated the US Digital Millennium Copyright Act by circumventing "YouTube's rolling cipher, a technical protection measure, that protects [the labels'] works on YouTube from unauthorised copying [and] downloading".
Such circumvention, the record industry trade group claimed, breached a provision in the DMCA that "prohibits circumventing a technological protection measure put in place by a copyright owner to control access to a copyrighted work".
For its part, Yout insisted that it does not in fact circumvent any technological protection measures in a way that breaches the DMCA. "Contrary to defendants' allegations, Yout's software platform is not designed to descramble, decrypt, avoid, bypass, remove, deactivate, or impair the YouTube rolling cypher technology", the stream ripping service argued.
"In fact", it added, "any digital mechanism in place designed as anti-circumvention technology stops Yout users from recording and saving that protected work, thereby demonstrating Yout's compliance with any anti-circumvention protections in place".
With that in mind, Yout then argued in its lawsuit, it was actually the RIAA that had violated the DMCA, by misrepresenting the nature of its service in formal correspondence with Google. And that misrepresentation, it alleged, had caused Yout tangible harm, resulting in cancelled subscriptions and the closure of its Paypal account.
The subsequent back and forth between the RIAA and Yout centred mainly on what constitutes a 'technological protection measure' in the eyes of US copyright law, and whether Yout was actually circumventing any such measures when its technology interacts with the YouTube platform.
Along the way the RIAA sought to have Yout's case dismissed with prejudice, which would prevent the stream-ripping site from re-filing any amended litigation related to this dispute, because - the record labels argued - any revised arguments would be "futile" anyway and therefore simply a waste of everyone's time.
The court overseeing the case granted the RIAA's motion to dismiss last week, but without prejudice, meaning Yout can now submit a revised legal claim to the court.
The "without prejudice" part of last week's ruling is key - according to an attorney at digital rights lobbying group the Electronic Frontier Foundation, which has been following the case - and means that the dismissal isn't as a big a win for the RIAA as it might first seem.
Basically, the EFF argues, both Yout and the RIAA had introduced too much new information as the case had progressed, which strengthened the argument that the original lawsuit should be dismissed. But that doesn't mean Yout can't present a compelling case against the labels in its next filing.
EFF's Mitch Stoltz told Torrentfreak: "The judge was highly engaged and appeared to be taking the time to understand the issue. A motion to dismiss is supposed to focus on the formal complaint without bringing in additional facts. Ultimately, because both Yout and RIAA brought up additional facts in their arguments about how YouTube works, the judge asked Yout to revise its complaint to add more detail. After that, there will likely be more briefing from both sides and another hearing".
Round Hill acquires share in Trevor Rabin's publishing catalogue
Confirming the deal, Round Hill CEO Josh Gruss says: "Trevor Rabin is an iconic songwriter who has authored major hits from his time with Yes, one of the most important progressive rock bands of the 1980s and 1990s, in addition to an irreplaceable portfolio of film score compositions spanning decades representing a lifetime of work from one of the masters of the genre".
"We believe this is a particularly attractive area in which to be increasing our exposure, as film and TV performance revenues continue to increase in value", he adds. "It is an outstanding privilege to welcome his catalogue to the company's portfolio".
Rabin himself, meanwhile, says: "Round Hill is well known in our industry from their decade of stewardship in managing some of the most important music catalogues. I know my music will be in good hands with their leading team of industry professionals who are so passionate about this catalogue".
Two more senior Sony Music Australia execs have left the company as investigation into toxic workplace culture continues
Sony Music confirmed that investigation was underway in June following the sudden departure of the boss of its Australian division, Denis Handlin, who had run said division for decades. At the same time The Guardian ran an article in which more than 20 former employees of Sony Music Australia described a workplace culture that wasn't fit for purpose.
Allegations made in the article included sexual harassment at work events, intimidating behaviour, alcohol abuse and the unfair treatment of women within the company. Handlin himself was not accused of harassment, however many of the interviewees were critical of the outgoing CEO for overseeing such a toxic working environment.
Soon after Handlin's sudden departure, it emerged that his son Pat - who was a VP of A&R at the major - and Senior Vice President Mark Stebnicki had both been put on indefinite leave. According to the Syndey Morning Herald, a spokesperson at Sony Music's global HQ in the US has now confirmed that both Handlin Junior - who had a stint at Sony's Syco label in the UK a few years back - and Stebnicki have now permanently left the company.
No official reason for the two men's departure has been given. Though, like Handlin Senior, neither of the departing execs has been publicly accused of harassment themselves. The Sony spokesperson confirmed that the internal investigation into the workplace culture of its Australian division is ongoing. As yet no replacement for Handlin Senior in the CEO role has been announced.
Last week it emerged that Universal Music has also begun an investigation into the workplace culture of its Australian business after a number of issues were raised by employees there as well, initially via a social media account.
New CEO announced for Def Jam US
The major's General Counsel and EVP Of Business & Legal Affairs, Jeffrey Harleston, has headed up Def Jam in the US on an interim basis ever since the label's previous CEO - Eminem manager Paul Rosenberg - stood down at the start of 2020. Harleston will continue to perform that task until Balogun - who previously worked in an A&R role at Universal's Interscope label - formally re-joins the business next year.
Announcing the appointment, overall Universal Music CEO Lucian Grainge says: "Tunji is part of a new wave of dynamic executives who view today's artists and music through a unique creative lens. Not only does he bring a deep understanding and respect for the cultural significance of what Def Jam has created over the past four decades, but he also sees the boundless potential of what Def Jam can be to a new generation of artists and fans".
Balogun himself adds: "I grew up on Def Jam's music - collecting, listening to and studying their albums and singles - those early moments as a young fan have had a lasting influence on who I am today. Def Jam remains one of music's most iconic brands and has always represented forward-thinking artists and partners that continue to shift ideas and impact culture around the world. I'm honoured to lead Def Jam into its next chapter and thank Lucian and Jeff for their support and this incredible opportunity".
And finally, Harleston chips in: "It has been an honour and a pleasure to lead and grow Def Jam over these past two years. Having had the privilege of working with Tunji for more than a decade, I couldn't be happier to hand the reins over to him. Tunji has all the tools to take the Def Jam brand and artists to new levels of success. He has the vision. He has a track record of signing the best and brightest new talent who ‘move culture' around the world and has always been an incredible advocate for artists".
Metrofest promoters hit back at criticism of their first event, including from a headliner
There was a flurry of criticism on social media about the retro hip hop and R&B centric Metrofest as the event took place last weekend. Some complained that the festival opened the gates at its North London site later than advertised and that, as a result, stages were running behind schedule all day. Others criticised general bad organisation and customer communications.
Though a lot of the criticism centred on changes to the line-up, with four of eight advertised headliners not performing. Eve had cancelled her performance at the event earlier in the week, meanwhile - on the day - Blackstreet, Mya and Tony Touch all seemingly failed to turn up. Fatman Scoop, who had been billed as MC for the proceedings, didn't arrive on stage until 7pm, and a Bobby V set was only ten minutes long.
Responding to one critical ticket-buyer on social media, Fatman Scoop stated: "What you DONT KNOW is how bad it was for the artists. I did not show up at 7pm FOR NO REASON. Trust me, you guys have NO IDEA what happened on the other side of this".
For Blackstreet and Mya, it seems that there were problems around the COVID tests that were required, both to perform and for the artists to subsequently return to the US. In their own social media posts, Blackstreet reportedly said Metrofest organisers were "terribly disorganised" and had "refused to give us our COVID test results to go back to the States".
In an official statement overnight, the event's promoters denied those claims, although did acknowledge the logistical issues on site that led to the festival running behind schedule and the cutting short of Bobby V's set.
"Unfortunately, due to circumstances beyond our control, Blackstreet and Mya, who were scheduled to appear on the main stage, refused to perform at Metrofest for their loyal fans who bought tickets for the event", the official statement reads. "It is also very disappointing that Blackstreet have since released an eighteen minute video on their social media accounts, containing false accusations in an attempt to shift the blame onto the Metrofest team".
"Blackstreet and Mya were fully paid for their set at the festival but refused to leave their hotel, citing that their [COVID] test results were unavailable", it continues. "We can categorically confirm that the documentation was sent to both artists. This is part of the same documentation provided by us for them to gain entry into the UK. We have fulfilled all of our contractual obligations and completely refute the false allegations in the video. We are appalled by this unprofessional behaviour which in turn resulted in a string of hold-ups".
"To be clear, Metrofest has copies of all of the artist's test results in compliance with UK government regulations, which were arranged and paid for privately by our team", the statement adds. "All artists were emailed their results. The Metrofest team worked tirelessly to deliver this festival to the public in 2021, after our initial debut event was postponed by a year due to COVID regulations".
All these factors, organisers then say, along with "unseasonal weather", "unforeseen artist travel logistics" and the need to comply with Transport For London regulations around the site, "affected traffic and delayed performers appearing as scheduled for the festival. Metrofest sincerely apologises for the show's late-running, which led to Bobby V's set time being cut short".
Regarding separate criticisms that some ticket-holders couldn't get onto the festival site, the statement continues: "To address the situation surrounding ticket holders that were refused entry due to late arrival, unfortunately, ticket holders were not allowed entrance after 5pm due to our licence. This was communicated in our T&C's to ticket holders in advance".
Nevertheless, because of the various issues, "we obtained authorisation and closed the doors at 6pm, giving everyone an extra hour".
Concluding, the statement says: "A special thanks to the artists that joined us across all Metrofest stages, and a special thank you to our international artists who travelled to the UK and adhered to the correct protocols: Bobby V, Jon B, Horace Brown, Fatman Scoop and our headliner Fat Joe, who performed in the UK for the very first time. Metrofest wants to thank all fans who attended our first event".
De La Soul confirm deal with Reservoir will get their Tommy Boy albums
The legendary hip hop trio went public in 2019 about their negotiations with Tommy Boy and its founder Tom Silverman regarding getting the six De La Soul albums released by the label streaming. They said that they could not accept the terms being offered by Silverman and that they were therefore ending all talks with the label. And, indeed, all efforts to get those albums streaming did seemingly stop there.
However, back in June, Tommy Boy was acquired by music rights firm Reservoir, leading to speculation that talks with De La Soul might now resume. Then, last weekend, rapper Talib Kweli said on Instagram that De La Soul were back in control of their masters, citing the group's Maseo as the source of that information.
And yesterday we got confirmation from De La Soul directly that a deal has indeed been done with Reservoir. Speaking on Instagram, the group's Trugoy confirmed: "We have finally come down to a deal between ourselves and Reservoir Media to release our music in 2021. So our catalogues will be released this year - we're trying to work hard and diligently along with the good folks up at Reservoir to get this done".
On the negotiations that have occurred since Reservoir's Tommy Boy acquisition, he added: "We sat down and we got it done pretty quick actually - it was kind of impressive how fast we got it done - maybe in two weeks time tops. [It was] a totally different approach than what was happening with Tommy Boy. And I'm not speaking to bash Tom Silverman or Tommy Boy in any way. But we're happy that that chapter is over and done with and we are looking forward to our relationship with Reservoir Media".
Reservoir then also confirmed that a deal has been done, telling Billboard: "We have reached a new long-term agreement with De La Soul that gives the group a new voice and interest in how their historic catalogue will be distributed. Reservoir couldn't be happier to come to an agreement with De La Soul, one of the most important groups in the history of hip-hop, and it's an honour to partner with them and make these classic albums available to the fans after all this time".
Needless to say, details of the deal are not known, though, I guess, knowing that these seminal albums will finally be available to stream is really all we need to know.
Kanye West now finishing off 'Donda' at another stadium, maybe
The iTunes Store still says it "expects" 'Donda' to be available to download as of Sunday. But who knows? It was previously expected the day after each of the two big listening party events West staged at the Mercedes-Benz Stadium in Atlanta but, alas, no.
West, of course, actually set up home at that stadium after the first listening party, further working on the record in a pop-up studio in the run up to the second listening party.
Earlier this week, in a now deleted tweet, West collaborator KayCyy declared "we're moving to another stadium". No details of which stadium were forthcoming, allowing fans - in the absence of any actual new music to listen to - to instead speculate what that other stadium might be.
HotNewHipHop noted that nearby venues that could possibly now be hosting West et al include State Farm Arena, Truist Park and Russ Chandler Stadium.
Make of that what you will. And then just keep on waiting for the new album that is going to drop soon. Maybe. Possibly.