The four major label groups are set to become three, as European regulators earlier today approved Universal Music’s takeover of EMI Music. The $1.9 billion takeover will make Universal the largest music company in the world. As part of the deal, Universal will divest roughly a third of the assets of EMI, which the New York Times notes is a reduced version of what they wanted originally, and significantly pares down its ambitions. Among those assets are Parlophone, which is EMI’s flagship European label. Universal also gives up global rights to distribute the artists on EMI’s labels, which include Coldplay and Pink Floyd, among others. Universal will keep recording rights for the Beatles, however. Reuters notes that Mute, Ensign, Chrysalis, EMI Classics and Virgin Classics are among the other parts that Universal will have to spin off.
It should be noted that while the takeover has been approved in Europe, Australia, Canada and Japan, it
still has to be cleared in the United States by the Federal Trade Commission. That ruling is expected shortly, and the Times doesn’t suspect that they’ll require any additional divestments. So what does that mean for metal? Nothing yet. EMI distributes labels in the states including Earache, Candlelight and Gravedancer, in addition to owning Capitol and Virgin, but it’s not thought that anything will drastically change on that front at least yet. On the Universal front, they’ll be selling off Sanctuary, Iron Maiden’s label and management company. It could be interesting to see where that winds up. EMI Music Label Services have done a great job of fostering a community of their metal labels, with programs like March is Metal Month. Hopefully that will remain intact as well.
At the end of the day, this means that 90% of the music sold worldwide is coming from just three companies. It’s not a surprise that EMI was finally sold, however. It was announced almost a year ago that this would happen, but it’s taken this long for the two corporations to hammer out a deal. EMI was seized by Citibank last year after it’s previous owner, Terra Firma, defaulted on its $5.4 billion loan.
UPDATE: Shortly after we published this, the Federal Trade Commission approved the takeover in America, without any additional conditions.