Music publisher Sony has bought Michael Jackson's 50 percent share in Sony/ATV Music Publishing from his estate. Sony agreed to pay $750 million for its joint venture partner's part.
The partnership between Sony and Michael Jackson was established in 1995, when the two parties agreed to formed a joint venture with Sony/ATV. The catalog has more than one million copyrights, including about 250 songs created the legendary group The Beatles and songs from current popular artists Taylor Swift, Beyonce, and Lady Gaga. The music publishing rights covered in the catalog includes the lyrics and music in all the recordings.
In the official announcement by Sony chief Kaz Hirai, the company reiterated its commitment to hold on to its entertainment assets, especially at a time when M&A speculation is running high through various media, as reported by Variety. "The entertainment business have long been a core part of Sony and are a key driver of our future growth," Hirai noted. He also shared the company's firm belief that these businesses will continue to contribute to Sony's success for the years to come.
The New York Times referred to the bought-in event as the ending of "one of the most closely watched contests in the music industry". Since October, it emerged that without warning Sony had notified the Jackson estate that the company was initiating the buy-sell provision in its joint-venture deal. The provision entitled either party to purchase the other's half of share.
Both the two parties have been struggling with their financial. Jackson, when he died in 2009, left more than $500 million in debt. The estate has ever since try to eliminate through movie deals, recordings, shows, and merchandise. On the other hand, Sony has also been suffering from a declining consumer electronics business, leading its investors to pressure the company to sell assets in order to raise cash.
After the transaction, Jackson estate will continue its interests in other music assets, including all of Jackson's master recordings and the publishing company that owns the songs written by the artists, Mijac Music. The company also own some of Michael Jackson's favorite songwriters and musicians that were acquired during his life. The estate will also remain the owner of 10 percent interest in EMI Music Publishing as reported The Guardian.
Jackson estate is giving up its 50 percent in its joint venture with Sony Corp. in Sony/ATV. Sony bought Jackson's share for $750 million, which includes more than one million copyrights from popular artists including The Beatles, Taylor Swift, Beyonce, and Lady Gaga.
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