PE-backed BMG linked to Parlophone bid

John Bakie
27 July 2012

Tweet
Facebook
LinkedIn
Google plus
Send to

Private equity-backed music group BMG Rights Management has been linked to a bid for Parlophone Records, a section of EMI responsible for music by bands including Coldplay and Radiohead.

BMG, a joint venture between Bertelsmann and KKR, is reported to have met with Universal over the sale of Parlophone Records. It is thought Universal would need to sell off the division to satisfy regulators over its proposed takeover of EMI.

However, while the majority of Parlophone's catalogue would form part of the sale, it is thought EMI would hold onto the lucrative rights for songs by The Beatles.

Universal has reportedly made offers to sell off several rights and independent labels to secure the deal, but the decision to sell Parlophone is thought to indicate the bid could be in major trouble of failing due to competition rules.

KKR and Germany's Bertelsmann media group invested in BMG in July 2009. Bertelsmann acquired 49% of the joint venture, which included its own rights management unit. KKR took 51% and planned to invest an initial €50m and then inject a further €200m during the next five years from its Europe III Fund.

BMG went on to buy British music publisher Chrysalis for £107.4m in November 2010, which was in line with its investors' strategy to build a music rights management business through organic growth and acquisitions.