As expected, pan-European indie labels trade body IMPALA yesterday reaffirmed its opposition to Sony/ATV’s planned acquisition of EMI Music Publishing, as the Sony Corp led music publisher finally submitted its bid plans to the European Commission for approval.
As previously reported, Sony/ATV, a joint venture between Sony and the Michael Jackson estate, is leading a consortium of investors in its EMI publishing acquisition. It’s thought EMI Music Publishing would stay an autonomous company if the Sony deal goes ahead, but ultimately reporting into Sony/ATV boss, and former EMI Music Publishing chief, Marty Bandier.
IMPALA opposes both Universal’s bid to buy the EMI record labels and Sony’s bid for the publishing catalogues, arguing that the two deals together are the worst possible outcome for an EMI sale, making the two biggest music firms even bigger, so they both dwarf nearest rival Warner.
That would result in a duopoly controlling the mainstream music industry. Both Universal and Sony, though, are confident their bids will be approved by regulators in the US and Europe, who in theory both have the power to block the takeovers, or to insist on remedies, such as the resale of some of the EMI assets the buyers will acquire.
Reconfirming its position yesterday, IMPALA said: “The concerns raised by the European Commission the last time it looked at music publishing concentration centred around the ability of large publishers to control prices and other terms, even in negotiations with much bigger players such as iTunes. This is because they control so much repertoire, making them an indispensable trading partner. These concerns are likely to have even more relevance today”.
It continued: “The independents are also concerned that the deal would give Sony too much power over collecting societies as well as vital industry negotiations, such as the Cannes Agreement, which sets operating terms for societies. They also point out that the deal would reinforce the duopoly effect with Universal, who itself is currently under regulatory scrutiny over its attempt to buy EMI on the recording side”.
Meanwhile IMPALA Exec Chair Helen Smith told CMU: “However this deal is structured in terms of finance and ownership, the result is the same – Sony would increase its negotiating power to an unacceptable extent. We expect the regulators to block both Sony and Universal’s bid to buy EMI”.
It’s thought the European Commission’s consideration of both takeover deals will require full two phase investigations, making any decision unlikely before June at the earliest.
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