It looks like Sony Corp. is moving closer to selling off its half of Sony/ATV Music Publishing, after recently triggering a clause in its contract with its co-owner, the Michael Jackson estate, that allows one party to buy out the other.
Sony /ATV is the world’s biggest music publishing company and is co-owned by Sony and the estate of the late Michael Jackson. The Michael Jackson estate now administers his half of the business. The two have jointly owned the company since 1995, each with a 50% stake.
Sony/ATV’s catalogue includes the copyrights to most of the Beatles’ songs, as well as songs by stars ranging from Marvin Gaye and the Rolling Stones to pop’s Taylor Swift and Calvin Harris
Music industry veterans estimate Sony/ATV’s value to be around $2 billion. Reports suggested that lenders were notified when Sony triggered the exit clause last month however there is no guarantee the process will result in Sony selling its half. Sony appears to have been considering the sale of its Sony/ATV stake for a nearly a year, if not longer.
The potential sale was mentioned in emails among top Sony executives in November of 2014—emails that were among thousands of documents stolen by hackers and posted online. In one email exchange following a planning meeting last year, Sony Corp. of America Chief Financial Officer Steve Kober wrote to Sony Entertainment Chief Executive Michael Lynton that they were trying to keep the potential sale “top secret.”
Michael Jackson had the brilliant idea to buy ATV Music Publishing for $47.5 million in 1985, and sold Sony a 50% stake for more than $100 million in 1995. Mr. Jackson died in 2009 while preparing for a comeback tour.
In 2012, Sony and Mr. Jackson’s estate joined other investors, including Abu Dhabi’s Mubadala Development Co. and music mogul David Geffen, to acquire EMI Music Publishing for $2.2 billion, and Sony/ATV Music now generates revenue administering the EMI catalog for the investor group.