Sony this week confirmed that it was paying $750m to acquire the entirety of Sony/ATV – snapping up the 50% of the business it didn’t previously own from the Jackson Estate.
That was a pretty penny for a company which Jackson bought for $41.5m in 1985.
Sony’s purchase price works out at somewhere around $770 per song – with Sony/ATV’s total catalogue comprising 1.94m copyrights.
In an email sent to staff yesterday and now obtained by MBW, Sony/ATV boss Martin Bandier suggests that Sony’s willingness to shell out $750m – 18 times what Jackson’s originally paid for the ATV catalogue – demonstrated its “absolute faith” in his team’s business.
“I cannot think of a clearer or more emphatic way for Sony Corporation to show its support for us and everything we do than by undertaking this deal,” he writes.
Bandier understandably reminds Sony/ATV staff of what he said in October last year – that the publisher’s ‘best years are ahead of us’.
When Bandier made that statement – after a buy/sell clause between Sony/ATV’s co-owners had been triggered – the Jackson Estate looked just as likely to buy Sony’s stake as the other way round.
Whispers now suggest that Sony may have been looking for at least $1bn for its holding in the company, before deciding to snap up the Jackson Estate’s share.
To a degree, that’s all irrelevant: Sony, the wider Corporation, is now in full control of the world’s second biggest record company right alongside the world’s biggest music publisher.
As well as gaining considerable market power, Sony suddenly seems a more stable, and less fragmented, major music business.
No wonder Mr. Bandier is in optimistic mood.
Read his note in full below.
As you have heard, Sony Corporation has signed a binding agreement to buy the 50% stake in Sony/ATV Music Publishing owned by the Estate of Michael Jackson, subject to regulatory approvals.
Once the deal is complete it will mean Sony/ATV will be 100% owned by Sony.
This outcome is very positive news for Sony/ATV and everyone who works for the company. I cannot think of a clearer or more emphatic way for Sony Corporation to show its support for us and everything we do than by undertaking this deal. It demonstrates their absolute faith in our company and recognizes the terrific job we are doing.
I would also like to take this opportunity to thank the Estate and particularly John Branca, John McClain and Karen Langford for all their support and input over the years of the joint venture. They will always be an important part of the Sony/ATV legacy.
“With the announcement this week we can now fully focus on the future.”
I know the last few months have created some uncertainty since the buy/sale process was announced last October and I cannot be prouder of the way everybody has continued to do their jobs in a professional and diligent manner and ensured that it really has been business as usual during this time.
With the announcement this week we can now fully focus on the future. I said at the time when the buy/sale process began our best years are still ahead of us and this deal has only confirmed that.
Sony/ATV is and remains the world’s leading music publisher and these past 12 months have been another great year both creatively and financially for the company.
For those of you working in New York there has already been the fresh start over the last few weeks of moving into tremendous new offices and we will also have a brand new home in Los Angeles later in the year. There will be much to look forward to this year as we take the first steps in this exciting new era.
Chairman & CEO
Sony/ATV Music PublishingMusic Business Worldwide