Universal Music Takeover Of EMI Music Approved By European Commission
The European Commission has approved the takeover bid of EMI by Universal Music if the company agrees to several concessions. Universal has agreed to divest one third of EMI assets in Europe including the Parlophone music label. The company must also agree to various market controls that will dictate how Universal Music handles digital music services contracts.
Universal will also be required to divest some of its own interests including several formerly independent labels and nine other EMI subsidiaries throughout Europe.
According to Electronista:
“Divestments include global rights to release music by artists on these labels, so EMI won’t have the rights to release records by big names such as Coldplay, Pink Floyd, Kylie Minogue, and David Guetta. Universal will get to keep recording rights for The Beatles and Robbie Williams, however.”
The requirements put into place according to the European Commission are meant to lessen the control Universal Music has over the digital music market.
Assets sold by Universal Music will generate annual revenues of $450 million for the European market.
The original $1.9 billion deal has already been approved in Australia, Canada, Japan, and New Zealand. Universal Music is now awaiting final approval from the Federal Trade Commission (FTC) in the United States.
Universal now plans to sell its Sanctuary label and Co-op Music within the next six months, companies that Universal Music will not be allowed to re-acquire in the future.
Do you think Universal Music’s acquisition of EMI is going to create unfair competition in the music marketplace?