EMI Music Publishing is adding a little more Motown to its collection — 30% more, to be exact.
The musicpub giant has upped its stake in the Jobete song catalog — home to a treasure trove of Motown classics including “I Heard It Through the Grapevine,” from 50% to 80% in a deal valued at more than $109 million. Deal values the full catalog at more than $360 million.
EMI purchased the stake from Motown and Jobete founder Berry Gordy, and will pay for it with the proceeds from the sale of its final 14.5% stake in U.K. music store HMV in November 2002. The publisher paid $132 million for its original 50% stake in the catalog back in 1997.
EMI Group chairman Eric Nicoli had hinted at just such a deal last summer (Daily Variety, July 21) at the British music major’s annual general meeting in London, noting that EMI had a standing deal to acquire the remaining 50% within five years. Jobete spins off $15 million to $20 million in cash per year.
Under the new deal, EMI has granted Gordy an option to sell his remaining 20% of the business, which he may exercise in either April 2004 or April 2005. If he doesn’t, EMI then has an option to buy that they must exercise in October 2005. A price range of $75 million to $86.3 million will apply to either deal.
The Jobete catalog, which Gordy started in 1958, contains more than 15,000 Motown recordings, including work written and performed by such R&B giants as Stevie Wonder, Marvin Gaye, Michael Jackson and the Supremes. Along with “Grapevine,” hit titles include “Ill Be There,” “My Girl” and “Ain’t Too Proud to Beg.”
Demand has swelled for publishing catalogs over the past two years as ailing music companies look for assets that are proven cash generators. Sony/ATV Music Publishing last year paid $157 million for the classic Acuff-Rose country catalog, and more recently rumors have circulated in the industry that other classic libraries may be snapped up.
Separately, EMI Music Publishing said it will develop a new Motown-based Broadway musical, produced by Gordy and featuring songs from the Jobete catalog.