The European Commission said on Friday that it had approved Sony Corporation’s move to take full control of EMI Music Publishing, saying the deal will not raise anti-competition issues. The Commission said it had cleared the transaction without conditions.
Sony Corporation announced the deal, which would see it acquiring Mubadala Investment Company’s 60% equity interest in EMI, in May. Combined with its acquisition of the Michael Jackson Estate’s stake in the company, the deal brings Sony’s stake in EMI effectively to 100%. While the final purchase price to be paid by Sony for all of Mubadala’s equity interest in EMI Music Publishing is subject to customary closing adjustments, the total cash consideration Sony expects to pay to consolidate EMI Music Publishing is approximately $2.3 billion.
The deal was approved over the strenuous objection of several European industry organizations, particularly independent-music coalition IMPALA, which was quick to criticize the decision on Friday. In a statement, the company said that the deal allows Sony to “double its catalogue of songs (from 2.16m to 4.21m compositions).”
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Helen Smith, IMPALA’s Executive Chair, commented: “This goes against the regulator’s own precedents. In 2012, it ruled that divestments were required for Sony to become a minority shareholder. Now that Sony is acquiring 100% control of EMI, it is being given unconditional approval. This is inconsistent and simply doesn’t stack up. It is a poor advert for European merger control and sends an alarming message to independent businesses in all sectors, not just music.”
“Sony will have a near monopoly over the charts and the whole music value chain will lose out as a result. Songwriters, composers, independent labels and publishers, digital services, and of course music fans, will all be worse off. This decision has dealt a significant blow to innovation and cultural diversity in Europe. IMPALA will review this decision very carefully, and we expect others will too.”
Reps for Sony did not immediately respond to Variety’s requests for comment.