BRUSSELS, Belgium (CelebrityAccess) — European anti-trust regulators on Friday approved the proposed acquisition of EMI Music Publishing by Sony Corporation of America without any conditions.
The Commission said that it found no competition concerns in the proposed merger, including the increase in Sony’s market power in relation to online music distribution platforms.
The Commision determined that since Sony already has joint control of EMI MP, the transaction would not lead to an increase in market share in any of the markets where Sony and EMI MP are active.
The Commision also concluded that the anti-competitive risks to music publishing were not substantive enough to block the merger as Sony/ATV and EMI MP have not competed to sign new authors since 2012, and as Mubadala did not constrain Sony’s strategy before the merger
As well, the Commission found that as Sony’s publishing operation Sony/ATV already has the sole and exclusive right to license EMI MP’s publishing rights offline, and as collecting societies control pricing and licensing terms for mechanical and performance rights, the merger did not constitute a threat to competitive markets.
The deal, first announced in May, will see Sony acquiring Mubadala Investment Company’s 60% equity stake in EMI. The deal, when completed, will bring Sony’s holdings in the storied record label to 100% and will expand Sony’s catalogue from 2.16m to 4.21m compositions.
While the final valuation of the acquisition has not been set, Sony has indicated the deal is worth approximately $2.3 billion.
The European Commission’s approval of the deal came despite strenuous objections from the European indie label community.
In a statement released following the approval of the merger, Helen Smith, executive chair of the Independent Music Companies Association (IMPALA) said:
“This goes against the regulator’s own precedents. In 2012, it ruled that divestments were required for Sony to become a minority shareholder. Now that Sony is acquiring 100% control of EMI, it is being given unconditional approval. This is inconsistent and simply doesn’t stack up. It is a poor advert for European merger control and sends an alarming message to independent businesses in all sectors, not just music.”
“This is bad news for the music sector and the digital single market. Sony will have a near monopoly over the charts and the whole music value chain will lose out as a result. Songwriters, composers, independent labels and publishers, digital services, and of course music fans, will all be worse off. This decision has dealt a significant blow to innovation and cultural diversity in Europe,” Smith added.