Authorization

Sony buys Jackson stake in Music Venture for $750 million

Sony buys Jackson stake in Music Venture for $750 millionSony Corp. is paying $750 million to the estate of Michael Jackson for the late pop star’s stake in their joint music business to take control of a catalog that includes artists Sting and Alicia Keys.

The terms call for Sony to make a lump sum payment of $733 million for Jackson’s 50 percent stake in Sony/ATV Music Publishing, as well as future distributions, according to a statement Monday. Talks on a deal began in September, when Sony exercised its right under their joint venture to buy out Jackson’s estate.

The deal consolidates Sony’s control over a catalog of almost 4 million songs as music industry revenues increasingly shift to subscription services offered by Apple Inc., YouTube and Spotify Ltd. The Tokyo-based company is sharpening its focus on network services including game and movie streaming centered on its PlayStation console.

“The value of music assets is increasing with the growth of streaming,” said Damian Thong, an analyst at Macquarie Group Ltd. in Tokyo. “Sony is actually paying less than the stake is worth.”

Leaked documents


Sony has said the growth of streaming services will help bolster revenues in the music business to as much as $5.2 billion in fiscal 2017. The company expects paid subscribers to account for 60 percent of the market next year, outpacing downloads with 22 percent and digital radio with 5 percent.

Shares of Sony shares fell 0.4 percent to 2,788 yen as of 10:26 a.m. in Tokyo, while the Nikkei 225 Stock Average declined 0.1 percent. The stock is down 7 percent this year.

The estate of Jackson, who died in June 2009 at age 50, will continue to have interests in the music industry. Those include all of the pop star’s master recordings and the publishing company that owns all of the songs he wrote. The estate will also retain its interest in EMI Music Publishing.

Read also: Russian court turns down Google appeal in anti-monopoly case

“This transaction further allows us to continue our efforts of maximizing the value of Michael’s Estate for the benefit of his children,” said John Branca and John McClain, co-executors of the estate.

The catalog was purchased in 1985 for $41.5 million, they said.

Documents leaked by hackers who broke into Sony Entertainment’s computers in 2014 revealed that executives at the company were weighing the future of the joint venture.

“The entertainment businesses have long been a core part of Sony and are a key driver of our future growth,” said Kazuo Hirai, Sony’s chief executive officer. “This agreement further demonstrates Sony’s commitment to the entertainment businesses and our firm belief that these businesses will continue to contribute to our success for years to come.”

Source: Bloomberg
See also:
Leave a comment
TOP Video
News
  • Latest
  • Read
  • Commented
Calendar Content
«    Декабрь 2016    »
ПнВтСрЧтПтСбВс
 1234
567891011
12131415161718
19202122232425
262728293031