Now that the other shoe has finally dropped and label founder Chris Blackwell has exited, the derby to lay claim to Island Records has begun, with the chieftains of Polygram’s other labels vying to add the potent label to their corporate portfolios.

Blackwell’s ankling also forced the resignation of Island exec veep/chief operating officer Larry Mestel. Blackwell’s move signals the final days of exec VP/G.M. Hooman Majd, and calls into questions the future of Davitt Sigerson, who had been tapped as Island’s new prexy.

On Thursday, Blackwell exited the label and resigned from the board of directors of its parent, Polygram. The ankling culminated three months of high-profile attacks by Blackwell on Polygram and its chieftains.

The departure comes after a week of negotiations between Blackwell and Polygram prexy and CEO Alain Levy. Blackwell had been in exits talks with Polygram since Monday, with the talks concluding in the wee hours of Thursday morning.

Sources said Blackwell exits with a clean slate — he doesn’t owe Polygram any money and the conglom isn’t paying off the remaining three years on his employment contract. He also exits without a non-compete clause, leaving him free to immediately start a new label.

The first casualty of the Blackwell departure was Mestel, who was forced out because of his close ties to Blackwell. Mestel was also an exec for Island Trading Co., Blackwell’s investment company.

Exec headed for exit

Majd, who was recently passed over for the Island presidency, is also poised to exit. Despite having the support of artists signed to the label, Majd was overlooked in favor of Sigerson, an outsider.

Sources said Polygram execs, despite recently giving Majd a new contract for two more years, are anxious for his departure. Majd’s exit could be agreed upon as early as today. Neither Majd nor Mestel could be reached for comment.

The shift at the top also puts a question mark over the future of Sigerson, the former EMI Records chief who was ousted as part of a corporate-wide restructuring and who is in negotiations to become Island’s latest prexy (Daily Variety, Sept. 22).

Sources said the choice of Sigerson had been agreed upon by Blackwell at the insistence of Levy and Roger Ames, Polygram Music Group prexy.

But the choice of Sigerson only made sense to Polygram execs, sources suggested, if Blackwell was still at the helm and maintained his famous hands-on approach. Sources said Ames will oversee the operation of Island until a prexy is named.

Sigerson’s nod filled the void created by the departure last year of John Barbis, a Levy loyalist who now runs Polygram’s A&M Associated labels. Insiders note the irony that Island could be added to Barbis’ purview.

Another chieftain circling is freshly minted Mercury Records Group chairman Danny Goldberg, who with the stroke of a pen by Polygram chiefs in August added Motown and Polygram Classics and Jazz to his fiefdom, and is considered the corporate golden boy.

Also in line is A&M Records chief Al Cafaro, who sources said is still seething over Goldberg’s rapid ascension and may have been behind rumors he was headed to Disney’s music arm in protest. Neither Goldberg nor Cafaro is on Polygram’s board of directors, as Blackwell had been.

‘Blood in the water’

“There’s blood in the water inside the company, and (Polygram execs) have to make sure what they do next sends the right message to artists and the industry,” noted a rival conglom CEO.

Though industry tongues wagged about the possibilities if Island were to be segued into an existing label group, a statement from Levy said Blackwell’s departure “will not affect the status of Island as a stand-alone unit within the Polygram group of labels.”

Blackwell’s decision to exit the conglom began this summer. The first indication that the sparring between Levy and Blackwell wasn’t business as usual came during a public salvo fired by Blackwell when he resigned as CEO of Island Pictures in August (Daily Variety, Aug. 28).

Blackwell ankled when Polygram Filmed Entertainment execs moved to insert its own editor on the Robert Altman film “The Gingerbread Man” after expressing dissatisfaction over the version delivered by the director.

In the following months, Blackwell engaged in a series of high-profile mudslinging aimed at Polygram in general, and Levy specifically, over being hamstrung when it came to running the music and film companies comprising the Island Entertainment Group.

Label under scrutiny

Island has been under the industry microscope, with wags attacking the slow sales of U2′s latest album “Pop Mart,” which is no longer in the Top 200 album sales chart. Save for Dru Hill (which is trying to exit the label) and a lackluster disc by Island-distributed Salt ‘N Pepa, the label’s industry presence has been largely uneventful during the year.

“(Polygram) announced today the termination of the agreement under which Mr. Blackwell’s services were provided to the music and film operations of Polygram’s Island Entertainment Group,” said a seven-line statement issued Thursday morning by Polygram. “Mr. Blackwell will also be leaving the board of management of Polygram.”

Polygram paid nearly $300 million for Island Records in 1989.

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