Universal’s £1.2 billion EMI bid approved without remedy in the US
By CMU Editorial | Published on Friday 21 September 2012
Universal’s bid to buy the EMI recordings division has now received approval without remedy from the Bureau Of Competition’s Federal Trade Commission in the US, via a unanimous vote, meaning the deal can now move forward to completion.
This means that, unlike in Europe where Universal was required to sell off nearly two thirds of EMI’s catalogues to get the deal through, no such divestments will have to take place in America.
In a statement, the Bureau Of Competition said: “We worked closely with the European Commission throughout the investigation, but reached different conclusions because of different evidence unique to each jurisdiction. For example, concentration levels in a number of EU Member States were significantly higher than the combined market share of Universal and EMI in the United States. In addition, the markets in Europe have a different, larger, and more diverse set of customers, and it appears that the market dynamics relating to digital streaming services differ significantly from those found in the United States”.
The government body also noted that the stern remedies in Europe would have an affect on the expanded Universal globally, saying: “Although the Commission did not conclude that a remedy was needed to protect competition in the United States, we note that the remedy obtained by the European Commission to address the different market conditions in Europe will reduce concentration in the market in the United States as well”.
In a statement, Universal told CMU: “We are pleased that the Federal Trade Commission has cleared Universal Music’s acquisition of EMI with no conditions. In addition to the U.S., the acquisition has already been approved by regulators in Europe, Australia, Canada, Japan and New Zealand. Our investment in EMI will create more opportunities for new and established artists, expand music output and consumer choice, and support new digital services. With a broad array of EMI artists like Katy Perry, The Beatles, Robbie Williams, Lady Antebellum and Norah Jones, we are well positioned to grow the company and offer music fans around the world more music and more choice than ever before”.
Earlier today, EMI CEO Roger Faxon said in an email to staff that he expected transfer of ownership from Citigroup to Universal would take place on 28 Sep, at which point he and CFO Ruth Prior would step down.