Michael Jackson is close to giving up on the Beatles.
In an attempt to avoid financial collapse, the tarnished superstar has agreed to give Sony a chance to purchase half his stake in the Sony/ATV Music publishing catalog. By selling a portion, Jackson will be able to refinance loans he has defaulted on that are worth hundreds of millions of dollars.
Jackson paid $47 million in 1985 for ATV, which has about 4,000 songs in its catalog, including 200 Beatles tunes. In 1995, Jackson made a deal with Sony to go in 50-50 on the venture.
Jackson, whose Neverland Ranch outside Santa Barbara has ostensibly been shuttered by authorities, used his share in the music publishing company as collateral on a $270 million loan from Bank of America.
BofA sold those loans to Fortress Investment Group, but the company that helped assemble that deal, Prescient Capital, has sued Jackson for not paying for the financial advice. That suit, in the millions of dollars, plus negotiations in Dubai, where Jackson is now living, triggered Jackson’s action to free up a chunk of his share in Sony/ATV.
Sony’s fear has been that Jackson would default and it would have another equal partner, especially if Jackson’s half were auctioned to the highest bidder. With the current setup, Sony could potentially bring in another partner and still have majority control over the asset or just run the entire operation on its own.
Beatles music, the most valuable of any pop music catalog, will increase in value yet again when the songs are made available through online download services.
Sony/ATV also publishes songs by Bob Dylan, Neil Diamond, Destiny’s Child, Garth Brooks and Roy Orbison.