The deal will give the company sole ownership of works by the likes of The Beatles, Bob Dylan, Eminem, Alicia Keys and Taylor Swift.
Michael Jackson’s estate has agreed to sell its remaining stake in a lucrative music catalog to Sony Corp. for $750 million, the entities announced Monday.
The terms call for Sony to make a lump sum payment of $733 million for Jackson’s 50 percent stake in Sony/ATV Music Publishing, as well as future distributions, according to a statement. Talks on a deal began in September, when Sony exercised its right under their joint venture to buy out Jackson’s estate.
The deal consolidates Sony’s control over a catalog of almost 4 million songs as music industry revenues increasingly shift to subscription services offered by Apple Inc., YouTube and Spotify Ltd. The Tokyo-based company is sharpening its focus on network services including game and movie streaming centered on its PlayStation console.
“The value of music assets is increasing with the growth of streaming,” said Damian Thong, an analyst at Macquarie Group Ltd. in Tokyo. “Sony is actually paying less than the stake is worth.”
The agreement for Jackson’s half-share of the Sony/ATV Music Publishing catalog will give the company sole ownership of works by The Beatles, Bob Dylan and other hit making musicians, including Eminem, Alicia Keys and Taylor Swift.
The deal represents another money spinner for Michael Jackson’s estate whose debts have been significantly erased via a mixture of new music and movie ventures and re-releases of the legendary singer’s most popular music.
The estate benefits Michael’s mother Katherine and three children Prince, Blanket and Paris.
‘’This agreement further demonstrates Sony’s commitment to the entertainment businesses and our firm belief that these businesses will continue to contribute to our success for years to come,” Sony Corp. president and CEO Kazuo Hirai wrote in a statement.
The sale however does not include rights to Jackson’s master recordings or songs that he wrote, and the singer’s estate will continue to have a stake in EMI Publishing, Inc.
“This transaction further allows us to continue our efforts of maximizing the value of Michael’s Estate for the benefit of his children,” the co-executors of Jackson’s estate, attorney John Branca and music executive John McClain, wrote in a statement. “It also further validates Michael’s foresight and genius in investing in music publishing.”
Jackson purchased the ATV portion of the catalog in 1985 for $41.5 million, and he later merged it with Sony. It remained his most lucrative asset at the time of his death in June 2009 at age 50, though by that point Jackson was hundreds of millions of dollars in debt.
The deal for Jackson’s half of the Sony/ATV catalog is expected to close by the end of March.
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