The Warner Music Group, the smallest of the three remaining major record companies, said on Thursday that it had made a deal to pay $765 million for the Parlophone Label Group, a package of divestments from the EMI label required by European regulators as part of the Universal Music Group’s $1.9 billion deal for EMI last year.
“This is a very important milestone for Warner Music, reflecting our commitment to artist development by strengthening our worldwide roster, global footprint and executive talent,†Len Blavatnik, the founder of Access Industries, Warner’s parent company, said in a statement.
The Parlophone group consists of EMI’s historic Parlophone label, home to artists like Coldplay, Blur and Kylie Minogue; EMI’s flagship label, with Pink Floyd, Iron Maiden and the D.J. David Guetta; as well as other labels like Chrysalis and EMI subsidiaries across Europe. They amount to about a third of EMI’s assets.
The deal is a win for Warner, whose international infrastructur has been relatively week compared with its major competitors, and for Universal, which came under intense pressure during the deal’s regulatory review process in Europe but ended up with a higher price than had been expected.
Early estimates for EMI’s castoffs were somewhat above $500 million, but with some smaller assets yet to be sold, Universal could get over $800 million, vastly reducing the price it paid for the bulk of EMI. Universal will hold on to EMI’s Capitol and Virgin labels, including artists like the Beatles, the Beach Boys, Katy Perry and Lady Antebellum.
Ben Sisario writes about the music industry. Follow @sisario on Twitter.
