×
You will be redirected back to your article in seconds

Vivendi Sets Date to Discuss Universal Music Group IPO With Board

Vivendi has set a date of May 17 to present to its board the initial findings for a potential IPO for Universal Music Group, according to a brief and carefully worded press release from the company.

“The Vivendi Management Board will present, during the next Supervisory Board Meeting on the 17th May, the initial findings relative to the different hypotheses of how the Universal Music Group capital might evolve,” said the release. In other words, the management board will present its findings to the supervisory board.

Last month, news broke that Vivendi had begun work on the long-rumored “potential listing” of UMG, its largest asset, according to reports from a company shareholder meeting in Paris.

Vivendi chief executive officer Arnaud de Puyfontaine said at Thursday’s the meeting: “We have started work that will allow us to present the benefits of a potential listing of UMG to the supervisory board,” Reuters reported.

In an enthusiastic report in August, Goldman Sachs raised its valuation of UMG to $23.5 billion (from around $20.1 billion), a 16% jump, and Sony Music to around $20.1 billion, based on its prediction that worldwide revenues from streaming will reach a whopping $28 billion by 2030, a 16% jump from its previous estimates. Along with UMG and Sony, the two largest major label groups — which Goldman pegs as collecting “55-60 percent of royalties for every piece of content that is being monetized” — the report singled out Amazon, Pandora, Tencent, Apple and, to a lesser degree, YouTube/Alphabet as top beneficiaries from this growth.

2017 was a strong year for UMG, whose revenues were up 10% to $6.8 billion year-over-year at constant currency and perimeter, according to its earnings report. The company is helmed by chairman/CEO Lucian Grainge.

By that same standard, its recorded-music revenues grew by 11.3% to $5.5 billion while growth in subscription and streaming revenues — which were up some 35% — more than offset the decline in both download and physical sales. Music publishing revenues grew by 9.6%, also thanks to the boost in subscription and streaming revenues, as well as growth in synchronization and performance revenues.

Merchandising and other revenues were down 7%, due to lower touring activity.

The report singled out new releases from Taylor Swift, Kendrick Lamar and Drake along with carryover sales from The Weeknd, the “Despacito” single from Luis Fonsi and the 50th Anniversary edition of the Beatles’ “Sgt. Pepper’s Lonely Hearts Club Band,” as well as soundtrack albums from the movies “Moana” and “La La Land” as primary drivers of the year’s growth. It also pointed to agreements with Tencent, Spotify, YouTube and Facebook, as well as its existing partnerships with Amazon and Apple, as “fostering an increasingly competitive and dynamic market for music among the biggest tech platforms and music services in the world.”

UMG’s income from operations amounted to €798 million, up 18.5% at constant currency and perimeter year over year as a result of higher revenues, with EBITA at €761 million, up 20.6% year over year as a result of higher revenues and “lower restructuring charges.”

 

More Biz

  • Republic Records Names Mel Carter Senior

    Republic Records Names Mel Carter Senior VP of A&R

    Republic Records has named Mel Carter as senior vice president of A&R, executive VP Rob Stevenson announced today. In his new role, Carter will scout, sign, and foster new talent for the Republic roster. Additionally, he will continue to oversee the current roster on his imprint, Hikari Ultra, under its joint venture with Republic. In 2018, Carter began consulting for the company and eventually [...]

  • T-Mobile President and CEO John Legere

    John Legere to Step Down as T-Mobile CEO

    John Legere, after more than seven years at the helm of T-Mobile and leading the takeover of rival carrier Sprint, will resign as CEO next May. Legere will be replaced by Mike Sievert as CEO, effective May 1, 2020. Sievert is currently president and COO of T-Mobile, and his new title will be president and [...]

  • Legendary Celebrity Photographer, Terry O'Neill, in

    Terry O'Neill, Celebrity Photographer of '60s and '70s, Dies at 81

    Terry O’Neill, the British photographer known for his famous shots of celebrities in the ’60s and ’70s and his marriage to Faye Dunaway, has died after a bout with cancer. He was 81. O’Neill’s agency told the BBC that he had prostate cancer and died at home on Saturday night after a long illness. O’Neill [...]

  • Hollywood celebrated the individuals redefining "on-screen

    Media Access Awards Honors Individuals Increasing Representation for Disabilities

    Hollywood celebrated individuals redefining “on-screen representation for the disability community” with the Media Access Awards, in partnership with Easterseals, at the Beverly Hilton Thursday. Norman Lear and Jimmy Kimmel kicked off the event, which featured Camryn Manheim, CJ Jones, Coby Bird and “The Peanut Butter Falcon” actors Zack Gottsagen and John Hawkes presenting awards along [...]

  • 'Roxanne' Singer Arizona Zervas Signs With

    'Roxanne' Singer Arizona Zervas Signs With Columbia

    Hotly tipped singer-songwriter Arizona Zervas, whose viral hit “Roxanne” is in the top 40 of the Billboard Hot 100,  has signed with Columbia, Variety has confirmed. Since the release of the track on Oct. 10, “Roxanne” has reached nearly 50 million streams on Spotify. The single topped Spotify U.S. top tracks chart for an uninterrupted [...]

  • Jax Media at Variety New Leaders

    Jax Media Accepts Variety's Creative Leadership Award at New Leaders Cocktail Party

    This year’s Variety New Leaders event, presented by City National Bank, honored innovative visionaries in entertainment. The cocktail party was hosted on a chilly Thursday night in Lower Manhattan’s Jimmy Rooftop Bar at the James Hotel. Patrick McCarthy, senior VP and head of marketing for City National Bank, kicked off the event highlighting the new [...]

  • taylor swift, scott borchetta and scooter

    Rage Against the Big Machine: What's Driving the Taylor Swift Showdown

    The latest Taylor Swift-Scooter Braun-Scott Borchetta kerfuffle involves the sort of music business minutiae that doesn’t commonly interest the general public — in fact, it’s probably safe to say that untold thousands if not millions of people are suddenly familiar with the concept of re-recording old masters. But in blasting Braun on social media and [...]

More From Our Brands

Access exclusive content