Warner Music Group Acquires Gala Music Group

Company looks beyond the West to enlarge its international portfolio

Looking beyond the West to enlarge its international portfolio, Warner Music Group has acquired Russia’s Gala Music Group. Terms of the deal were not revealed.

Gala, headed by CEO Alexander Blinov, was founded in 1988 as the first privately owned record label in Russia. During that era, the giant state-run imprint Melodiya controlled the biz in what was then the USSR, but era of glasnost and perestroika saw a commercial thaw.

Agreement marks WMG’s first wholly-owned presence in Russia.

In global corporate terms, the Warner-Gala pact is a snug fit: Access Industries, WMG’s parent since 2011, is helmed by Russia-born industrialist Len Blavatnik, and many of the company’s holdings, from petro-chemical interests to media, are based in the country.

Gala’s acts include MakSim, Dan Balan, Petr Nalitch, and Bianka and the groups Pompeya, Infiniti and 30.02. Its distribution unit Music Ltd works with such international indie labels as K7 and Harmonia Mundi, and has repped EMI’s international catalog in Russia for nearly 20 years.

Company also operates the dance label Kontora and music publishers S.B.A. Music Publishing Ltd. And United Musical Publishing House LLC.

Another major international deal remains pending: WMG’s $765 million acquisition of England’s Parlophone labels, divested in the breakup and sale of EMI Music to satisfy regulators, is awaiting approval.

WMG CEO Stephen Cooper said in a statement, “Russia represents a significant opportunity and, with Gala spearheading our operations there, we will be well positioned for growth in this vibrant and dynamic market.”

Announcement of the Gala acquisition came on the heels of a pair of significant promotions in WMG’s international music unit.

On Friday, Stu Bergen was promoted to president, international at Warner Recorded Music; he was formerly executive vp of international and head of global marketing at WMG.

Simultaneously, Mike Jbara, former prexy-CEO of WMG’s distribution arm WEA, was named president, worldwide of Alternative Distribution Alliance, the company’s indie distribution unit.

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