The European Commission has approved the £1.2bn purchase of EMI Music by the Universal Music Group.
The deal was approved with strict conditions that that include the divestment of Parlophone and various assets worldwide.
Although approved, the EC has said that is has concerns regarding the sale. They believe the sale “would have allowed Universal to significantly worsen the licencing terms it offered to digital platform that sell music to consumers.” But “substantial commitments” have since been made by Universal, with the Commission concluding that the transaction would no longer raise competition concerns.
So far, the deal has been approved in several countries including Japan and Canada. The US is yet to approve the deal but is expected to make an announcement next week.
Parlophone Records is the home to some of the biggest musical acts in the world including Coldplay, Tinie Tempah and Kylie Minogue. Other sections that will need to be sold off include EMI France, which is home to David Guetta, EMI’s classical music labels, Mute and Chrysalis. The divestment also takes in Co-opeartive, which handles marketing for various indie labels.
Interestingly, Universal has also ageed to sell EMI’s 50% stake in ‘Now That’s What I Call Music’ and to continue to license its repertoire for the brand for the next 10 years, although keeps its own stake in the joint venture.
Thanks Music Week!