WMG buying majority stake in Roadrunner
EmptyNEW YORK -- Warner Music Group has entered into a deal to acquire 73.5% stake of Roadrunner Music Group B.V., parent company of hard rock and heavy metal label Roadrunner Records, for $73.5 million.
Island Def Jam has been distributing Roadrunner, perhaps best known as the home to rock radio staple Nickelback, for the last five years. The move and corresponding sale of a majority stake in the label to WMG comes at the recent conclusion of a five-year 50-50 joint venture between Roadrunner and IDJ parent Universal Music Group.
Following completion of the purchase, the Netherlands-based label will be housed within WMG's Atlantic Records Group in the U.S. and within Warner Music International for the rest of the world.
Roadrunner founder and managing director Cees Wessels will continue to head the label and operate it as a freestanding entity with its own sales marketing and promotion staffs.
No layoffs or restructurings are planned for Roadrunner's global staff of between 100 and 120. Founded in 1980 RMG has subsidiaries in eight countries around the world, with offices in New York within the United States, Canada, United Kingdom, Germany, France, Japan and Australia.
The pact reunites Wessels with WMG Recorded Music Chairman/CEO Lyor Cohen, who previously was responsible for overseeing IDJ's relationship with Roadrunner dating back to 2001.
Based on 2006 results, WMG now lays claim to the top three positions in Hard music marketshare in the U.S., with Warner Bros. at No. 1, Atlantic at No. 2, and Roadrunner No. 3
In four of the last five years, Roadrunner has had at least one of the five top-selling Hard Music acts in the U.S. with releases from Nickelback.
In addition to Nickelback, Roadrunner's roster includes multi-Platinum Grammy winner Slipknot, Grammy-nominated Stone Sour, Killswitch Engage, Theory of a Deadman, Megadeth, Black Label Society and Trivium, among others.
The transaction is subject to regulatory approval in Germany and is expected to close in January 2007.