Like the popular nursery rhyme ‘Ten in a Bed’, that says: there were ten in the bed and the little one said “roll over, roll over” so they all rolled over and one fell out; in the case of the four major record companies, which was six back in 1998 and has nothing little to do about it.
EMI, Sony, Universal and Warner have now become the big three as they each consume a large chunk of EMI’s music and publishing catalogue to become substantially larger and a more powerful force in the music world.
The acquisition of assets owned by EMI was by no means an easy sale, the four-month auction ended this week withstanding some unstable times within the international credit markets and surprised many in the music industry and on Wall Street with a higher than expected final sale price, helping Citigroup recoup some of the $5.5 billion it had loaned to fund a private equity takeover four years ago.
A break down of the sale sees EMI’s recorded music operations being sold to the Universal Music Group for $1.9 billion, while EMI’s music publishing division will be sold to a consortium of investors led by Sony for $2.2 billion.
The break up of EMI ushers in a new era within the music industry, reducing the number of major record companies from four down to three. This absorption of recorded works and publishing rights sees Sony and Universal, who are already two of the biggest companies in music, to become even bigger!
The deal means there is a new home for EMI’s recorded music assets that include The Beatles, Pink Floyd, Nat King Cole, some of Frank Sinatra’s mid-career material as well as modern day stars like Katy Perry and Coldplay. Also the labels Capitol, Virgin and Blue Note are also included in the take over.
This marks the end of the road for the British music company which was founded in 1931 by the merger of Columbia Gramophone Company and Gramophone Company (His Masters Voice) that both had history dating back to the beginning of recorded sound.