Regulators To Clear Universal’s $1.9 Billion Purchase Of EMI
As previously reported, in early July Sony/ATV Music bought up EMI’s Publishing arm for $US 2.2 billion from prior owners, Citigroup, effectively making them the largest music copyrights company in the world.
The combined group would include a vast library of current top-selling and legendary names including Jay-Z, Kanye West, Katy Perry and Pink Floyd. However, it won’t include the biggest-selling band of all time, The Beatles.
Only a few days after the announcement however, the European Commission gave a list of objections to Vivendi SA – who owns Universal Music Group - during their bidding efforts to take over EMI’s recorded music division, with an offer of $US 1.9 billion.
Their objections were similar to those dealing with Sony Music’s music’s acquisition of EMI Publishing would mean they could use their dominant market share to increase pricing regulations were cleared by the European Commission along with The US Federal Trade Commission, who indicated that publishing laws – unlike recording labels – were closely regulated in various countries.
Now however, regulators in Canada, Japan and New Zealand have cleared the takeover and, while the France-based company may be waiting for the U.S. Federal Trade Commission to give the green light, The Chicago Tribune have reported that the EU Commission will indeed grant the all clear as well.
The deal, which is the largest international music industry story of the past 12 months, has been frought with tense negotiations and disagreements in its long lead up to the final decision, which is expected on the 9 September.
New negotiations between the EU Commission and Universal were being established to address the watchdog’s concerns, including proposed discussions to ensure that the independent acts and labels they distribute would get the same financial terms of digital music services that Universal secures for its own label.
Following the proposed purchase, Vivendi’s chief executive, Jean-Bernard Lévy, even stepped down from his position citing “divergence of views on the strategic development of the group”, most likely to do with the EMI bid.
He has since been replaced by Universal Music head, Lucian Grainge, who has reassured the company of their commitment to going ahead with the EMI deal.