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Sony Corporation has signed a deal to acquire a 60 percent share in EMI Music Publishing from a consortium led by the Mubadala Investment Company. It increases Sony’s stake in the company to 90 percent overall, in a deal that carried a $4.75 billion valuation.
It appears the Michael Jackson estate still owns the remaining 10 percent of EMI Music Publishing.
With both parties signing a “legally binding” memorandum of understanding for the acquisition — which is pending regulatory approval and other conditions before it can close — the arrangement will give Sony publishing assets that generated about $1.334 billion in revenue last year, Billboard estimates.
“We are thrilled to bring EMI Music Publishing into the Sony family and maintain our number one position in the music publishing industry,” Sony Corp. president and CEO Kenichiro Yoshida said Monday in a statement. “The music business has enjoyed a resurgence over the past couple of years, driven largely by the rise of paid subscription-based streaming services. In the entertainment space, we are focusing on building a strong IP portfolio, and I believe this acquisition will be a particularly significant milestone for our long-term growth.”
EMI Music Publishing generated adjusted earnings before interest, taxes, depreciation and amortization of $249 million on revenues of $663 million in the fiscal year ended March 31.
According to the announcement, Sony will assume EMI Music Publishing’s debt, which totaled $1.359 billion as of March 31, and expects to pay $2.3 billion, which totals $3.659 billion. If the Jackson estate still owns its nearly 10 percent stake, which the deal appears to value at $475 million, that leaves another $660 million is unaccounted for — which could be additional debt.
EMI Music Publishing owns or administers over 2 million songs that include classics by Queen, Carole King and the Motown catalog, along with contemporary songs from Kanye West, Alicia Keys, Drake, Sam Smith, Pink, Pharrell Williams, Calvin Harris, Fetty Wap, Hozier and more, according to Sony.
“EMI Music Publishing represents one of the world’s largest and most diverse catalog of copyrights with iconic songs that span every decade over the last one hundred years,” said Mubadala Capital head of private equity and EMI Music Publishing chairman Adib Mattar. “The sale of our consortium’s interest in EMI Music Publishing represents a milestone for Mubadala and our private equity business.”
This story first appeared on Billboard.com.
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