WMG for Sale
  • squashedsquashed

    Private investment group Yucaipa Companies is reportedly the front-runner to acquire Warner Music Group, as CNBC reports the group has bid $3 billion for the music company. According to CNBC, the next closest bid came from BMG,
    which offered $2.8 billion for recorded and publishing arms combined.
    Approximately 70 percent of Yucaipa's proposal is comprised of
    approximately $2.1 billion in debt.

    Yucaipa is reportedly aligned with a number of investment partners, including Napster and Facebook co-founder Sean Parker and investor Doug Teitelbaum, CNBC is unsure who exactly is involved with the final bid for WMG.

    The shortlist of final WMG bidders also includes Sony Music, Tamares, Guggenheim Partners, Platinum Equity, the Gores Group and Permia, according to CNBC. Sources also tell the network's Kayla Tausche that Live Nation
    is still in the mix, but only interested in the division of WMG's
    business that manages its artists. The bidding period for WMG has
    officially ended and all final bids are believed to have been submitted.

    http://www.fmqb.com/article.asp?id=2156594

    $3Billion? lol. (I thought hypem worth $3Billion.)

    Sony music next. Come on Sony electronics, when are you going to drop sony music? It's shitty economy in the US and Japan. You really think Britney Spears is going to save the company?
  • SongbyToadSongbyToad
    Adam might kill me for saying this, but I really do think Beggars Group is the only major label, in any meaningful musical sense.
  • TimTim
    Big Evil Beggars! Grrrr.

    But seriously, $3 Billion for WMG?! Anyone paying that is either a fruitcake or utterly naive - didn't they *lose* $150 million last year?
    The $3 Billion valuation seems to be based off last years revenue, but as a trend that is on a massive decline - quarterly revenues dropped 20% year on year 2009-2010, and I wouldn't imagine 2011 being any better.

    I know they would value themselves optimistically, but am I missing something from their financials?


  • TsuruTsuru
    For some reason, I always think of Merge as one of the big ones in the Toad sense...
  • Sean RSean R
    Surely someone with a brain could turn WMG back into a workable/profitable business? 
  • TsuruTsuru
    I don't think so, except in name only. In fact, I think all labels may be extinct sooner than we care to think.... 
  • squashedsquashed
    Well, some proposals by wall st. geniuses.

     (obviously, it all doesn't make sense. since nobody proposes: music people wants to hear and stop suing fans? Maybe they should ask for government bailout.)

    http://www.businesswire.com/news/home/20110420006567/en/Fitch-Comments-Warner-Music-Groups-Potential-Strategic

    Fitch Comments on Warner Music Group's Potential Strategic Options

    SALE OF 50% OR MORE OF WMG:
    WMG ACQUIRES EMI:
    LIQUIDITY AND LEVERAGE:
  • squashedsquashed
    image

    As it turns out, it's money WMG does not have to just throw around out there. The company has turned a profit once in the last ten years. After taking a look at the books, Digital Music News surmises that the company has lost-Are you sitting down? Good.-10.14 billion dollars in the last ten years.


    There you have it. A hard statistic as to how one of the biggest record
    labels in the world is doing in the digital age of music. The answer:
    not very well at all. To expand upon the woes of WMG, securities analyst
    SmarTrend has pointed out that WMG is now $1.9 billion in debt and has
    the worst debt-earnings ratio in the entire entertainment industry.The fact that one of the big labels is suffering this badly is, in and of itself, a glaring indicator to the fact that the old ways are coming to an end.

    ....

    And to add insult to injury, Amazon.com sent out a letter to all of the labels
    regarding licensing for Amazon's recent launch of Cloud Drive and Cloud
    Player. The letter...well, Digital Music News's headline for the story
    sums it up as: "Dear Labels, Go F**k Yourself. Love, Amazon."
    ...

    http://www.seattlepi.com/default/article/Nail-In-The-Coffin-RIP-WMG-1340498.php
  • squashedsquashed

    LOLOLOLOLOLOL.....

    2 dinosaurs down.  2 more to go. (Sony Music can't possibly hang on for much longer. Universal/Vivendi is a little hard tho' it's completely political party machine now. France.)

    I was expecting EMI/WMG to die last year gawd. take them forever to end their miserable little existence.
  • TsuruTsuru
    LOL. Some billionaire spent $3.3 Billion on Warner Bros music. I guess my bid of $169.23 was rejected? http://bit.ly/lzqLVB
  • TimTim
    The best part is the guys selling WMG only paid $2.8 Billion a few years ago for it.
    So after hemorrhaging money for the past few years its value has apparently increased.

    Solid business sense.
  • squashedsquashed
    Speculation Over WMG Publishing Spinoff As Citi Prepares EMI Sale

    June 9, 2011

    Even though the sale of Warner Music Group to Len Blavatnik's Access Industries
    has yet to close, there is still speculation that other companies are
    getting ready to buy off pieces of the company, once the sale is
    complete. The New York Post reports that BMG Rights executives met in New York this week to discuss how to potentially purchase pieces of the Warner/Chappell publishing arm of WMG.    The speculation is that Access may also make an attempt to buy EMI from Citigroup later this year, which would lead to a sell off of pieces of both companies due to regulatory restrictions. Universal Music Group and Sony/ATV would also be interested in the Warner/Chappell division.Sources tell the Post
    that Citigroup could get between $3.3 and $4 billion for EMI. Blavatnik
    bought WMG for $3.3 billion earlier this year. The deal is expected to
    close by late summer, once it receives approval in Europe.    Meanwhile The Wrap
    reports that Citi is moving ahead with an "aggressive" plan to sell off
    EMI, including a potential low price tag closer to $2.5 billion, to
    sell off the company as quickly as possible. A source tells Digital Music News, "It's 'Operation Dump EMI,' and yes it's getting stepped up."    http://www.fmqb.com/article.asp?id=2208798

  • squashedsquashed

    Warner Music Plans $1.05 Billion Junk Bond Sale Before Buyout

    WMG Acquisition Corp. may sell $150 million of 9.5 percent
    senior secured notes due June 2016 that are an addition to
    existing bonds, and $695 million of senior debt maturing in
    October 2018, said a person with knowledge of the transaction.
    WMG Holdings Corp. plans to offer $200 million of senior bonds
    due in October 2019, said the person, who declined to be
    identified because terms aren’t set.

    http://www.bloomberg.com/news/2011-07-06/warner-music-plans-1-05-billion-junk-bond-sale-before-blavatnik-takeover.html

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