BMG acquires Cherry Lane Music Publishing
Company's roster includes Elvis Presley, Black Eyed PeasGermany-based BMG Rights Management has sealed a deal to acquire Cherry Lane Music Publishing, whose roster includes Elvis Presley, the Black Eyed Peas, Quincy Jones and the Sex Pistols.
It is the biggest acquisition by the 18-month-old BMG Rights Management and gives the company a major presence in the U.S. It launched stateside in December with offices in New York, Los Angeles and Nashville following its July acquisition of Crosstown Songs America.
BMG Rights Management was launched in October 2008 by Hartwig Masuch, former BMG Music Publishing Germany CEO, shortly after Bertelsmann sold its 50% stake in the Sony BMG joint venture to Sony. Universal Music Group agreed to acquire BMG Music Publishing in 2006, which enabled Bertelsmann to clear debt.
"Having already established itself once as a leader in the music publishing industry over several decades, BMG, via its partnership with KKR, has quickly begun to take on a leadership position again on a global basis," said Peter Primont, Cherry Lane's CEO and a major shareholder.
Added BMG's CEO Hartwig Masuch, "We chose to acquire Cherry Lane given its highly regarded, service-oriented approach with its artist/songwriter clients, its extensive catalog of legendary songs and its breadth of relationships within the music, television and filmed entertainment communities."
Terms were not disclosed, but the Financial Times on Friday reported a price of $85 million-$100 million. It said that Cherry Lane, which is celebrating its 50th year, might have favored the German company because it was more likely to keep most of the 70 staffers.
There was interest in Cherry Lane from other music publishers and private equity firms in mid-2008, when it launched a strategic review. But Cherry Lane put the review on hold amid the sudden global financial turmoil.
BMG Rights Management, a Berlin-based joint venture between Bertelsmann and private equity firm KKR (it came on board as a JV partner in July), also has been linked to EMI's music publishing assets. Bertelsmann CFO Thomas Rabe said during a news conference last week that the company will look at EMI if it goes on the market.
"The strategy of BMG Rights Management is based on organic growth as well as on acquisition growth," he said. "Since the start, we have done over 100 signings and acquisitions and are on a good path. We have also bought middle-sized publishing companies. There will be more."
KKR director Philipp Freise said Friday, "This acquisition validates the growth story that we set out to build when we launched the innovative BMG partnership with Bertelsmann last year, combining KKR's capital with BMG management expertise."
BMG Rights Management recently signed a global publishing deal with Leona Lewis. Before the Cherry Lane deal, it represented the rights to more than 75,000 compositions including hits by Kelly Clarkson, Christina Aguilera and Britney Spears.
Billboard contributors Andre Paine and Wolfgang Spahr reported from London and Berlin, respectively.