Universal Takeover of EMI Music Is Approved

The following is an excerpt from an article in:


The New York Times
Saturday, September 22, 2012

Universal Takeover of EMI Music Is Approved

By BEN SISARIO

For the Universal Music Group, months of uncertainty came to an end on Friday when it received regulatory clearance in Europe and the United States for its $1.9 billion takeover of EMI Music.

Next week the deal is set to close, and Lucian Grainge, Universal’s chairman, plans to address the EMI staff in Los Angeles as its new leader.

But serious questions about the deal remain to be answered, for Universal as well as for artists and consumers around the world.

On Friday, after negotiations that lasted through the summer, the European Commission approved the deal under the condition that Universal sell a third of EMI’s assets. Those include Parlophone and various other labels in Europe, as well as the rights to release music around the world by some of EMI’s most famous acts, including Coldplay, David Guetta and Pink Floyd.

The Federal Trade Commission also gave its clearance on Friday, with no added demands.

“It’s a historic day for UMG, and a historic day for EMI,” Mr. Grainge said in an interview. “Inevitably I’m disappointed that we were not able to retain Parlophone. However, I can only remain focused on the opportunity and the achievement.”

Where EMI’s castoffs end up may not be known for months. According to a memo to EMI employees sent on Friday by Roger Faxon, its chief executive, once Universal completes its takeover of most of EMI, artists on labels to be sold will fall under the authority of a “hold separate manager” that will report to a trustee for the commission. (In that memo, Mr. Faxon also announced that he would resign next week.)

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