Sony buys EMI in $2.8b deal
Sony is buying EMI Music Publishing, getting its hands on a catalogue of 2.1 million songs from Beyonce, Carole King and other artists as it embarks on a new growth plan built on content and services.
The Japanese company will buy about 60 per cent equity interest from a consortium led by from Mubadala Investment Co. for about US$2 billion ($2.8b), Sony said in a statement.
The Tokyo-based company already owns almost 40 per cent of EMI, operates the business and had been in talks to buy the library for the past few months.
EMI’s extensive catalogue will solidify Sony’s position as the largest music publisher amid a boom in streaming services that has fuelled valuations for music copyrights. The transaction is the first major strategic move by Kenichiro Yoshida, who took over as chief executive officer in April. He is set to unveil a threeyear plan that embraces Sony’s growing reliance on income from gaming subscriptions and entertainment.
“We are thrilled to bring EMI Music Publishing into the Sony family and maintain our number one position in the music publishing industry,” Yoshida said in the statement.
Mubadala said the deal is based on an enterprise value of US$4.7b, exceeding its target of getting at least US$4b for EMI. That’s double what the Sony-led group, paid for the business six years ago.
That makes the sale the largest musicindustry transaction since the last time EMI changed hands.
Music publishing has long offered owners a steady source of cash, in contrast with the cyclical recorded music business, which is dependent on hits and retail sales and has historically gone up and down depending on the success of new release.
Growing paid streaming services from Spotify and Apple have boosted music-industry sales for three years in a row and enticed investors to splurge on catalogues. Last month, Sony disclosed it will record a gain of almost US$1b from its stake in Spotify following the streaming service’s public debut.