Government-mandated sales fetch label group $909 million
With two sales agreements announced Wednesday, Universal Music Group finally completed the long, European Commission-mandated divestment process following its acquisition of EMI’s recorded music assets. EMI’s European share of the venerable “Now That’s What I Call Music” series will be claimed by Sony Music Entertainment, while independent marketing entity Co-Op will be sold to PIAS Recordings.According to a source, European rights to the “Now” series will fetch around £40 million ($60 million), while PIAS will pay less than $760,000 for Co-Op. When the divestment package was announced, the cumulative value of the assets was estimated at around $606 million; in total, UMG recouped $909 million from the sales, approaching half of the $1.9 billion it paid for EMI’s assets in the first place, with much of that money coming from the higher-than-expected sale of the Parlophone Label Group to Warner Music Group for $765 million. Move finally completes the process begun in fall 2011, when UMG announced it was purchasing EMI Recorded Music. After the label group agreed to divestments, the merger was formally approved last September. Max Hole, CEO of UMG Intl., said in a statement: “This sale, along with our previous transactions, not only satisfies our agreement with the European Commission, but further demonstrates the value we have been able to unlock through the targeted divestment of quality assets.” The “Now” series, which first bowed in Europe 30 years ago, has generated worldwide sales of more than 200 million copies. While UMG’s Wednesday sales wrap up one of the more protracted record label diasporas in recent memory, the asset-snatching will resume shortly, as WMG plans to auction off portions of its newly acquired Parlophone package in order to pass regulatory scrutiny.