Sony In Talks Over Now! Music Stake
The music major Sony is edging towards a deal to snap up a stake in the Now! compilation series as Universal Music Group continues to shed assets as part of its takeover of EMI, the rival label.
I have learned that Sony Music is the frontrunner to buy a 50% shareholding in Now!, which marks its 30th anniversary this year.
A deal would see Sony pay tens of millions of pounds for the stake, which at the moment is jointly-owned by Universal and EMI. The European Commission has ordered the sale of a number of labels following the acquisition last year of EMI by Universal, the world's biggest record label.
A number of other potential buyers of the Now! stake are understood to be waiting in the wings if the talks between Sony and Universal collapse. Universal intends to hold onto its existing share of the joint venture.
Now!, which is understood to have generated sales of just over £20m in 2012, is the leading music compilation franchise in Europe. The brainchild of music industry executives including Sir Richard Branson, who during the early 1980s headed Virgin Records, Now! will shortly launch its 84th album comprising chart hits from the previous three months.
As much as 95% of Now!'s European revenues come from the UK and Ireland, with the franchise having sold more than 80 million albums in the UK since its inception.
Last week, Universal announced that it had reached an agreement to sell Parlophone, the home of Coldplay and Pink Floyd, to Warner Music Group, another of the four majors which dominate the music industry.
Warner struck a deal to pay £487m for Parlophone, a price that exceeded industry expectations, meaning that when the deal completes, Universal will already have recouped almost half of the money it spent on acquiring EMI. That was despite the fact that Universal was a forced seller and underlined the strength of the interest in buying Parlophone.
Among the other bidders for Parlophone was Simon Fuller, the showbusiness tycoon, who had enlisted financial backing from an array of global investors.
Universal, which is owned by Vivendi, the French conglomerate, has already sold Mute, another label, to BMG, the fourth of the large record companies.
Universal declined to comment on the Now! sale process.