Sony income set to soar after EMI acquisition

Sony HQ

Sony Corp’s acquisition of EMI Music Publishing will add approximately £726 million to Sony’s operating income, according to figures published as the long-running deal was concluded.

An SEC filing stated the deal would bring in around 105 billion Yen of “additional operating income” once EMI is fully under Sony control.

Sony’s $2.3 billion (£1.8bn) purchase of the remaining 60% of EMI that it did not control values the company at $4.75bn (£3.72bn). EMI will become a wholly owned subsidiary of Sony, despite opposition to the deal from IMPALA, BASCA and ESCA.

The deal gained regulatory approval from the EU last month, although IMPALA could still potentially appeal that decision. Sony has not waited for that to play out, however, moving swiftly to conclude the deal. It already effectively ran EMI through Sony/ATV, having headed a consortium that bought the publishing company in 2012. It had already announced plans to buy the Michael Jackson Estate’s 10% stake in EMI for £287.5m (£225.3m).

As part of the deal, Sony took on $1.3bn (£1.02bn) of EMI’s interest-bearing debt, of which $960m (£753m) was repaid immediately.

IMPALA had previously published research that it said showed Sony would control an average 70% of key European charts if the acquisition went through.

Outgoing Sony/ATV CEO Martin Bandier will also enjoy a big boost from the deal, with reports suggesting he will pick up as much as $95m (£74m) through a management equity plan, with a further $95m to be shared among 15 other top executives. Warner/Chappell boss Jon Platt will take over at Sony/ATV next year.

For more stories like this, and to keep up to date with all our market leading news, features and analysis, sign up to receive our daily Morning Briefing newsletter

subscribe link free-trial link

follow us...