Exec sells majority of interest in label, exits music biz
Richard Branson is out of the music business, selling all but 5% of his interest in the label V2 to Morgan Stanley.Branson’s Virgin Group — which includes phone service, airlines, soft drinks and other ventures — sold off its music label “to rationalize their portfolio of other content-led businesses.” That has been interpreted as meaning Virgin intends to launch a Virgin-branded music television station. In 2002, Morgan Stanley acquired a 47.5% equity stake in the label by converting $128 million in bonds. It has now upped its stake to 95%. In the U.K., Virgin Group recently struck a deal with cable TV operator NTL to offer a one-stop Virgin shop for cable television, telecom services and broadband. Tony Harlow is expected to remain head of V2 in the U.K., as Morgan Stanley will not have any active participation in the label’s management. In the U.K., V2’s roster includes Paul Weller, Stereophonics, Bloc Party and Wolfmother. Six months ago, Sheridan Square Entertainment acquired V2 North America. Label distributes recordings by the White Stripes and Jack White’s new band, the Raconteurs, plus Ray Davies, Josh Ritter and others. V2 marked Branson’s return to the record business in 1996, four years after he sold his Virgin Records imprint for about $900 million to EMI. The label struggled, especially in the U.S., until it had a hit with Moby’s “Play” in 1999.