Time Warner's buying
ROME — Italian pubcaster RAI is in advanced negotiations to sell its music publishing division, Fonit Cetra, to Time Warner for a sum in the region of $10 million, RAI sources confirmed.
The intention to sell off the division, which no longer is essential to RAI’s core business, was announced in June last year as part of the restructuring program of the pubcaster’s commercial operations. The sale is being handled by KPMG Consulting.
Recording industry and political representatives have expressed their objections to the sale, which would represent the second major Italian music company acquired by a foreign buyer after Ricordi was purchased by BMG.
“I’m not surprised and I’m not scandalized,” commented popular singer-songwriter Gino Paoli, whose compositions will be included in the sale. “But it seems curious that the synergy between RAI and Fonit is unable to bear the same fruits as the one between (commercial TV group) Mediaset and its recording label RTI.”
Those opposed to the deal say Fonit Cetra is being undersold, and, with a structural overhaul, the division could still generate revenues of around $17 million per year. RAI counters that concerned political forces have had ample opportunity to step in and restore the music company to financial health.
The pubcaster also refutes charges that it is selling off a part of Italy’s national cultural patrimony by pointing out that the music division’s historic archive of RAI productions, which includes renowned concerts and recordings of Maria Callas and Italian stars such as Anna Magnani and Toto, is excluded from the deal.
While 1997 figures are not yet available, Fonit Cetra’s turnover for 1996 was $10 million, with losses for the year of just over $2.2 million.