Sony Music Entertainment cashes in Spotify shares

Sony Music Entertainment cashes in Spotify shares

Sony Music Entertainment has sold 17.2% of its shares in Spotify. The major made the move at the IPO launch, bringing in a gain of $260.5 million (£185.1m) for the label.

The windfall was revealed in a filing to the SEC.

Sony’s original 5.7% stake would have been worth around $1.5 billion (£1.06 billion) after the first day’s trading. 

The company has said it's expecting a total net gain in the value of its holdings of 105 billion yen (£698.4m), taking into account payments of a share of the equity sale to artists and indies. Sony has not disclosed at what price the shares were calculated prior to the IPO, so the amount from the sale being distributed to labels and artists remains unclear.

A spokesperson reiterated their position this week: “Sony Music and The Orchard are committed to sharing with their artists and distributed labels any net gain they may realise from a sale of Sony Music’s equity stake in Spotify. This is consistent with our previously announced policy of sharing breakage and equity proceeds from digital catalog licenses with our artists and distributed labels.”

Universal Music and Warner Music Group do not have to disclose sales of Spotify stock as they have smaller holdings under the threshold for reporting.

 

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