Universal Music Group-EMI Deal Enters Home Stretch
LONDON - Universal Music Group's bid to acquire part of EMI has entered its final phase of regulatory review in Europe, but while UMG parent Vivendi confirmed a first payment required under the deal, the status of European regulators' thinking about it remained unclear on Monday.
European regulators on Friday consulted on whether the EU Commission should approve Universal Music Group's bid for EMI's recorded music business, but neither the company, nor European regulators said before or after the weekend what they had recommended.
Executives at Vivendi, the owner of UMG, recently reiterated that they expected the EU to approve the $1.9 billion deal later this month with conditions. Analysts have also generally predicted conditional approval. The U.S. regulatory review is also expected to wrap up soon.
Meanwhile, a Vivendi spokesman said Monday that the company has made a payment required under the EMI deal early this month. In striking the deal with EMI owner Citi, the company had agreed to make an initial payment of around 1.25 billion euros ($1.6 billion). The spokesman said the payment was made last week.
The amount was due whether the deal was likely to get European regulatory approval or not. Vivendi CFO Philippe Capron on a recent earnings conference call only mentioned that the payment "should take place in September."
Meanwhile, Friday's European regulatory discussion saw an advisory committee comprised of representatives of the EU states make recommendations on the proposed deal. Based on that, the EU Commission must make its final decision by Sept. 27. The decision didn't immediately leak out.
UMG has in recent weeks made further concessions, including asset sales, to clinch the deal, sources have told THR.
UMG's offer to regulators was believed to include the sale of global rights of the Parlophone catalog, excluding the Beatles, and other catalogs. The company had originally only offered to sell the European rights to music.